Gemini creditors’ Bitcoin holdings

YEREVAN ( — Gemini creditors face a challenging situation regarding a proposed reorganization plan. This plan, if accepted, may result in Gemini Earn users recovering only a fraction of their original investments in Bitcoin.

Bitcoin Price Uptrend Failed Gemini Creditors

Did You Know? In early 2023, Gemini Earn, a crypto lending program, faced significant issues when its partner, Genesis Global Capital, filed for bankruptcy. This led to suspending withdrawals from Gemini Earn, affecting numerous investors who could not access their funds. Notably, both Gemini and Genesis are daughter companies of Digital Currency Group (DCG), which they both sued. More details to follow.

Specifically, in a worst-case scenario, they might receive just about 30% of the current market value of their Bitcoin (BTC) holdings, or 61% of the value of their crypto from Jan. 19, 2023, as the BTC price has jumped up over 100% since.

Bitcoin (BTC) price . Gemini  creditors DCG
Bitcoin (BTC) price. Source: TradingView

This proposal has sparked significant opposition among the creditors, many of whom are urging to vote against it. The dissatisfaction stems from the substantial reduction in the value of their assets compared to the current market rates​​. Bloomberg exchange-traded fund analyst James Seyffart agreed, calling the agreement “Brutal.”

Gemini Genesis DCG
James Seyffart Tweet. Source: X

Gemini Reorganization Plan

In addition, Gemini has been critical of a bankruptcy recovery plan related to Genesis, describing the potential deal as “misleading at best.” This criticism is directed towards a plan that would see Gemini creditors receive only a portion of the money they are owed. The dispute centers around the recovery of funds from a lending program that has been going on for several months​​.

Furthermore, Genesis, its parent company DCG, and its primary creditors, including Gemini creditors, agreed on a restructuring plan in principle.

This restructuring agreement could result in either a sale of Genesis or the turnover of its equity to creditors. Gemini will contribute up to $100 million to compensate Earn users with frozen assets as part of this agreement. The plan is a critical step towards recovering for Gemini Earn users, though it remains subject to the bankruptcy court’s approval​.

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