A US bankruptcy court has approved the liquidation plan of cryptocurrency lender Genesis Global, paving the way for the return of approximately $3 billion to its creditors. Judge Sean Lane, in a memorandum decision, stated that Genesis’ Chapter 11 liquidation plan is reasonable and has been proposed in good faith. The plan ensures that the company’s limited assets will be distributed to its unsecured creditors. However, the decision is not in favor of Genesis’ parent company, Digital Currency Group (DCG), which argued that the bankruptcy plan would prioritize certain creditors and leave equity holders with nothing. In response, Judge Lane stated that DCG’s objection was based on its lack of recovery as an equity holder and that there are insufficient assets to provide any recovery to DCG. Genesis’ customer funds have been frozen since November 2022 due to liquidity issues caused by the collapse of crypto hedge fund Three Arrows Capital.
