Gemini Legal Team has raised allegations against Digital Currency Group in their recent effort to salvage the Genesis recovery plan. This plan was presented during Genesis’ bankruptcy proceedings. It details a framework that promises unsecured creditors a substantial 70-90% recovery.
Notably, a significant portion of the payout would be in digital currencies, according to DCG’s proposal. However, Gemini appears to be deeply skeptical of this proposition. In a filing made on Friday, lawyers representing Gemini criticized DCG’s approach, labeling it as a form of “gaslighting.”
Additionally, they have asserted that DCG is consistently making contrived, misleading, and inaccurate claims. This effort is aimed at manipulating not only the creditors of the Genesis estate in general but, more specifically, the Gemini Lenders.
Gemini vs. DCG: Dispute Over Debt Settlement and Controversial Deal Proposal
Gemini legal team has gone on to characterize this as an attempt to entice the Gemini Lenders into accepting a deal. Consequently, this deal would ultimately enable DCG to settle its debt for significantly less than what it genuinely owes.
This dispute traces its origins back to earlier this year when Genesis’ lending unit entered bankruptcy. Since then, Gemini and DCG have been engaged in a heated battle. However, the conflict began when Genesis froze withdrawals from the retail lending program, Gemini Earn.
During the summer months, Tyler and Cameron Winklevoss, the co-founders of Gemini, publicly accused DCG’s CEO, Barry Silbert, and Genesis of misleading investors.
The plan presented by DCG on Wednesday aims to renegotiate the terms of a significant $630 million loan between Genesis and DCG. According to this proposal, a portion of the loan would be promptly repaid in cash once the deal is finalized.
The remainder would be structured as a two-year note. The successful execution of this plan depends on securing approval through a vote from the involved creditors.
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