Genesis Creditors Accuse Manipulation In FTX Settlement, Adding Fuel To Legal Battle

Crypto News– As reported by CoinDesk, a faction of creditors has raised allegations against GGC, claiming that the company manipulated the bankruptcy proceedings by purportedly acquiring votes related to the proposed $175 million settlement agreement with FTX. This settlement amount represents a substantial reduction from FTX’s initial claim of $4 billion.

Genesis Creditors Accuse Manipulation In FTX Settlement, Adding Fuel To Legal Battle

The group, identified as the ad hoc creditors, has chosen not to disclose the identities of its members but has asserted that, collectively, they hold claims totaling $2.4 billion against GGC. This significant sum constitutes a majority within each class of claims, adding significant weight to their objections.

The dispute has given rise to contentious interactions with other creditors, notably Gemini, which has previously expressed opposition to the proposed settlement. Gemini’s argument revolves around the notion that Genesis Global Capital should forfeit its exclusive rights to propose a wind-up plan in the bankruptcy proceedings.

It’s worth noting that Gemini initiated legal action against Digital Currency Group (DCG), accusing Genesis of “fraud.” DCG, in response, characterized these accusations as “defamatory” and merely a “publicity stunt.”

This ongoing legal battle highlights the intricacies involved in bankruptcy proceedings and the divergent interests of crypto creditors. With substantial sums in play and conflicting viewpoints on settlement terms, the final outcome of these legal disputes remains uncertain.

The case serves as a reminder of the importance of transparent and equitable resolution processes within the crypto industry, while also underscoring the potential for prolonged legal conflicts to arise in the midst of intricate financial arrangements.