Genesis Granted Renewal Of Recovery Plan To October 1

Key Points:

• Judge Sean Lane of the United States Bankruptcy Court has granted Genesis a plan extension.
• FTX cannot participate in secret mediation meetings between the insolvent crypto lender and its parent company DCG.
• The company’ exclusive solicitation period has been extended to October 1.

According to a Bloomberg report, a court in Genesis’ bankruptcy case has extended the deadline for the firm to produce a recovery plan.

U.S. Bankruptcy Court Judge Sean Lane extended a mediation session between crypto lender Genesis and its creditors during a Monday bankruptcy hearing as tensions rose over the role Genesis’ parent company Digital Currency Group (DCG) will play in the lender’s rehabilitation. Such an arrangement would serve as the foundation for a Chapter 11 bankruptcy plan to pay hundreds of thousands of the company’s creditors.

Moreover, Judge Sean Lane refused to initiate settlement negotiations with FTX, which is also in bankruptcy and believes Genesis owes them $3.9 billion.

Lane has so overturned FTX and a number of Genesis clients’ complaints. Over two dozen people had contacted the court, begging him to halt the settlement discussions immediately and direct compensation to creditors. Other creditors claimed that they had received no information on the status of their claims.

On May 19, the corporation sought a 100-day extension to file its recovery plan.

Genesis disputes that it owes FTX any money and has urged Lane to set up a months-long procedure to determine the actual amount. Lane will decide whether or not to start that procedure at a hearing next week.

The extension is contingent upon the company’s ongoing cooperation with its Official Committee of Unsecured Creditors in developing a strategy. If negotiations fail, the Committee may seek a move to end the extended filing time with seven days’ notice.

Moreover, Genesis’ exclusive solicitation time has been extended till October 1 rather than October 26 as originally requested. The company may request more extensions in the future.

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Harold

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