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Gemini win users raised a collective sigh of relief that the gemini, genesis of world capital (genesis), and digital money group has reached an agreement on the winning program.
Digital Money Group will also seek to exchange a note of $1.1 billion for equities and refinance around $1 billion in loans.
In the end, Gemini, Genesis and DCG reached an agreement.
In an ad that sounds like music to them, Gemini Earn users have started to get their money back, like the Gemini exchange that Winklevoss started, Genesis Global Capital Limited Company (Genesis), and the Digital Currency Group (DCG) eventually struck a deal. The deal will give users access to funds that have been in limbo for months while the twins and genesis were fighting.
The agreement was announced on Twitter by the co-founder of the Gemini exchange, Cameron Winklevoss, who tweeted,
“Today, @Gemini reached an agreement in principle with Genesis Global Capital, LLC (Genesis), @DCGco, and other creditors on a plan that provides a path for Earn users to recover their assets. This deal was announced today before the bankruptcy court."
Details Of The Agreement
According to one of the lawyers representing the debtors, all parties involved agreed to the deal in principle and were working on finishing the term sheet, which could be filed as early as Tuesday. The agreement currently implies group of digital money, genesis world capital, and two groups of ad hoc creditors. Over $2 billion in lawsuits against Gemini Global Capital and Gemini Trust Company.
As part of the agreement, Gemini made a commitment to provide an additional $100 million to its users. A lawyer representing Gemini stated,
“Gemini founders Cameron and Tyler Winklevoss are doing this because they believe in the debtors’ reorganization and the Gemini platforms, and they want to do the right thing for their users.”
In addition, Digital Currency Group will also trade its existing $1.1 billion bill due in 2032 for convertible preferred shares. It will also seek to refinance its existing term lending for 2023 in two instalments. They will be payable to creditors worth $500 million in total.
The Gemini-Genesis Spat
Gemini and Genesis have both been locked in a bitter public spat over the former’s Gemini Earn program. The program has allowed users to deposit their crypto assets and earn between 0.45% and 8% return, similar to what a bank account would provide. The principal partner in the program was genesis. However, due to significant market turmoil, Genesis halted withdrawals in November 2022, an action that led to users of the Earn program and Winklevoss to threaten the company and its founder, Barry Silbert, with legal action. Winklevoss required Genesis to prepare a repayment plan for Gemini's $900 million loan to Genesis Global.
On the 19th of January, filed for Chapter 11 bankruptcy and joined a growing list of companies filing for bankruptcy. At the time, Genesis cited the collapse of three capital (3ac) and ftx arrows as the main cause of the company's failure. Subsequently, federal regulators in the United States opened an investigation into Gemini’s Earn program, with the United States Securities and Exchange Commission (SEC) charging the company with violation of securities laws.
A Significant Step Forward
Meanwhile, Cameron Winklevoss called the agreement a critical step towards the recovery of assets for all of Genesis’ creditors, in addition to highlighting Gemini’s intention to contribute an additional $100 million towards the Earn program. He also added that, while much more work remains to be done, he remains confident that there is a framework to move forward and take advantage of. Genesis’ interim CEO Derar Islim stated,
“I am grateful to the talented team at Genesis for their ongoing dedication and commitment to client service and excited about working together to build Genesis for the future. I would also like to express my deep gratitude to all of our customers for their ongoing patience and loyalty as we work to find a solution for our credit industry."
