DCG brings out a new plan for user compensation.
A new restructuring proposal from Digital Currency Group (DCG) aims to compensate the investments of Gemini Earn users.
Revealed on September 13th, the plan also outlines the partial recovery of assets for other creditors impacted by the Genesis Global bankruptcy.
Did you know?
Want to get smarter & wealthier with crypto?
Subscribe - We publish new crypto explainer videos every week!
What is Cardano in Crypto? (Easily Explained!)
In the newly submitted settlement framework, DCG suggests a recovery rate from 70% to 90% for unsecured creditors, with a considerable part likely to be in cryptocurrency.
For customers of Gemini Earn, a separate part within the plan estimates a potential reimbursement of 95-110% without necessitating any financial input from Gemini itself. DCG elaborated:
If Gemini were to agree to provide $100 million to Gemini Earn users under the Proposed Agreement, as it previously did, there would be little doubt Gemini Earn users would receive more than full recovery.
This recent settlement offer follows another DCG proposal made at the end of August, focusing on offering DCG shares to creditors. However, the August plan was dismissed by lenders, who accused the indebted Genesis Global and its unsecured creditors of being “unwilling to comply with their fiduciary obligations” to optimize the repayments to stakeholders.
Genesis Global faced liquidity issues that led to a bankruptcy filing in January 2023, affecting the firm's operations and its creditors, including Gemini. Gemini Earn users had been particularly affected, as they found their withdrawals frozen due to the Genesis financial woes.
Further complicating matters, DCG and another DCG-affiliated company, DCG Investments, were sued by Genesis Global on September 6th over defaulted loans of $600 million. This was just a day after Genesis Global announced plans to discontinue its spot trading services on September 18th.
DCG's newly proposed settlement plan could offer almost complete financial recovery for Gemini Earn users. While it marks a step forward, the proposal is yet to gain approval amid a cloud of ongoing legal complexities and financial disputes related to Genesis Global.
