In a recent legal move, Digital Currency Group’s (DCG) subsidiary Genesis Global Capital LLC has filed a complaint against the crypto exchange platform and custodian Gemini. Genesis hopes to claw back $689 million from the centralized crypto trading platform founded by Cameron and Tyler Winklevoss in 2014.
Genesis Targets Gemini in $689M Legal Battle Over Alleged Preferential Crypto Withdrawals
The court filing, filed on November 21, 2023, accuses Gemini of withdrawing over $689 million in the months leading to Genesis’ Chapter 11 bankruptcy proceedings. This action, according to Genesis, unfairly benefited Gemini at the expense of other creditors.
The complaint, filed in the wake of significant crypto market instability that began in 2022, targets transactions occurring in the 90 days preceding Genesis’ bankruptcy declaration. According to the document, Gemini’s withdrawals totaled approximately $689.30 million, a move Genesis describes as preferential and detrimental to the broader creditor base.
This situation arose during a period marked by notable fluctuations and uncertainty within the cryptocurrency sector, further complicating the financial dynamics at play. Genesis’ legal strategy aims to invoke the provisions of the Bankruptcy Code to rectify what it perceives as an inequitable situation.
By doing so, they intend to recover the withdrawn funds in a clawback, thereby restoring a level playing field among all of Genesis’ creditors. The lawyers insist the focus is not just on the monetary aspect but also on the principles of fairness and equitable treatment in bankruptcy proceedings.
The complaint details the significant withdrawals by Gemini, characterizing them as preferential transfers. These actions, as per the filing, allowed Gemini to allegedly gain an advantage over other creditors, an advantage that Genesis seeks to nullify.
What do you think about the Genesis court filing against Gemini? Share your thoughts and opinions about this subject in the comments section below.
