In conclusion, as reported by the Wall Street Journal, around October 2023,

Crypto lender Genesis Global is pursuing a Chapter 11 liquidation plan that abandons a previous settlement proposal to restructure around the estimated $1.6 billion in loans it extended to its parent company Digital Currency Group.

Genesis filed court papers Wednesday for a plan to exit from chapter 11 without a resolution of its claims against DCG, the crypto conglomerate founded by finance veteran Barry Silbert. Genesis is now preparing to liquidate its assets without the settlement proposal reached in August as at the aforementioned date. Bankrupt crypto lender Genesis Global and a major creditor group reached an agreement with its parent company and largest borrower, Digital Currency Group earlier in August of 2923, paving a way for resolving billions of dollars in cryptocurrency claims in chapter 11. The new framework was poised to deliver up to 70-90% recoveries for Genesis customers according to the documents signed as reported by the Wall Street Journal, only to decide against this new agreement with its latest liquidation decision in late October of 2023. This decision comes after a New York Attorney General Letitia James sued Gemini Earn and DCG’s Genesis Capital of defrauding their customers $1.1 billion.

The lawsuit alleges that Gemini and DCG’s Genesis Global Capital unit did not disclose the risks associated with a crypto-lending program they began in 2021. According to the suit, Gemini misled customers about the risks involved in its partnership with Genesis and failed to reveal that nearly 60% of its third-party loans were given to Sam Bankman-Fried’s now-defunct crypto trading firm, Alameda Research. All three companies have denied James’ charges.

Now Grayscale on the other hand was left with no other feasible action than to break out of the shackles it found itself in. Grayscale went on to sue the SEC for rejecting the proposal of turning its GBTC into an ETF. I'm sure this is a popular terrain, we all know how that ended with Grayscale coming out victorious and in doing so, forced the hand of the SEC to approve all Spot Bitcoin ETFs even though they never wanted to. From Gary’s comments after the approval, you could still see he never supported is not about to be in a hurry of Bitcoin even though he taught all about Cryptocurrencies at MIT when he was still a lecturer there. From Gensler’s remark after the approval, you can see clearly the reason for the Spot Butcoin Approvals, in his words and I quote;

“ Today, the Commission approved the listing and trading of a number of spot bitcoin exchange-traded product (ETP) shares.

I have often said that the Commission acts within the law and how the courts interpret the law. Beginning under Chair Jay Clayton in 2018 and through March 2023, the Commission disapproved more than 20 exchange rule filings for spot bitcoin ETPs. One of those filings, made by Grayscale, contemplated the conversion of the Grayscale Bitcoin Trust into an ETP.

We are now faced with a new set of filings similar to those we have disapproved in the past. Circumstances, however, have changed. The U.S. Court of Appeals for the District of Columbia held that the Commission failed to adequately explain its reasoning in disapproving the listing and trading of Grayscale’s proposed ETP (the Grayscale Order). The court therefore vacated the Grayscale Order and remanded the matter to the Commission. Based on these circumstances and those discussed more fully in the approval order, I feel the most sustainable path forward is to approve the listing and trading of these spot bitcoin ETP shares.”

Now that we have all that out of the way, let's talk about the lawsuit Almeda Research dropped against Grayscale and then followed with the real truths behind the recent Bitcoin downside. As always, your favorite Crypto Journalist -Clever Abaribote. See you soon.

Sources :

NYC Attorney G lawsuit : https://www.pymnts.com/legal/2023/genesis-new-bankruptcy-plan-draws-ire-of-the-feds/

SEC Chair’s comments : https://www.sec.gov/news/statement/gensler-statement-spot-bitcoin-011023