Bankrupt crypto lender Genesis sues Gemini to recover $689M of ‘preferential transfers’

Bankrupt crypto lender Genesis International Capital has filed a lawsuit in opposition to cryptocurrency alternate Gemini to recover $689 million in preferential transfers, according to a Nov. 21 courtroom submitting.

The lawsuit alleges that through the 90-day interval earlier than Genesis filed for chapter in January, Gemini withdrew an “mixture gross quantity of at least roughly $689,302,000” on the expense of different collectors and continues to profit by way of retaining the property Genesis seeks to recover. Genesis’s council requested the courtroom to use the treatments supplied by america Chapter Code to appropriate the “unfairness and return Defendants to the identical place as Plaintiff’s different similarly-situated collectors.”

The 2 crypto giants have been embroiled in a public feud over the restoration of funds that escalated into lawsuits after the collapse of crypto alternate FTX in November 2022.

Aside from authorized treatments, the CEOs of the 2 firms have been additionally concerned in public spats, accusing one another of noncooperation and threatening authorized motion.

Gemini filed an adversary proceeding against Genesis on Oct. 27 to use 62,086,586 shares of its Grayscale Bitcoin Belief. The shares have been used as collateral to safe loans made by 232,000 Gemini customers to Genesis by way of the Gemini Earn program. The collateral is at present value roughly $1.6 billion.

Associated: Court approves Genesis settlement of $175M to FTX, expunges billions in claims

Genesis filed for bankruptcy in January after suspending withdrawals in November 2022. The Genesis chapter adversely affected the Gemini Earn program, main the crypto alternate to sue Genesis parent company Digital Currency Group (DCG) and its CEO Barry Silbert for fraud in July. 

In September, Genesis additionally sued DCG, searching for the reimbursement of a number of loans value over $600 million.

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