Gemini co-founder Cameron Winklevoss made a "final offer" of $1.46 billion to Digital Currency Group (DCG) founder Barry Silbert to settle the latter’s debt.
The head of the trading platform said the "games are up" — Gemini Earn users are in a "suspended" state, as assets worth more than $1.2 billion are stuck in Genesis Global, which is owned by DCG.
"This offer is fair and reasonable for all and represents a minimum for creditors who must back the deal," said Winklevoss.
If Silbert does not agree to the proposed terms by June 6, the exchange’s chief warned he would sue.
Earlier, DCG, Genesis, the creditors’ committee of the crypto-lending platform, and Gemini agreed to launch a 30-day pre-litigation settlement process.
The parties are seeking a workable resolution to the February 2023 Genesis creditors’ agreement, under which creditors would recover 80% of the funds lost. The arrangements envisaged a gradual write-down of Genesis’s credit portfolio and the sale of insolvent entities.
But in May, DCG missed a $630 million payment to the Bitcoin exchange as compensation; Gemini filed suit, seeking the immediate return of $1.1 billion for 232,000 affected Earn users.
Genesis owes more than $3.5 billion to its 50 largest creditors, including Gemini, Cumberland, Mirana, MoonAlpha Finance and New Finance Income Fund VanEck.
Financial support for the group’s lending business was needed after the June 2022 bankruptcy of the cryptocurrency Three Arrows Capital hedge fund.
As noted, on 6 November 2022 Genesis Global Capital froze withdrawals and the issuance of new loans. The firm cited "heightened requests" from clients after the FTX collapse.
In January 2023 Genesis Global Holdco and its subsidiaries Genesis Asia Pacific and Genesis Global Capital filed for bankruptcy. According to media reports, their liabilities exceed $3 billion.
In May, DCG founder Barry Silbert liquidated 120,000 shares ETCG, a subsidiary of the holding company he leads, worth $755,295.