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HomeLaw & PoliticsThe First Hearing Of Genesis Capital’s Bankruptcy Case Is Scheduled: Check Details

The First Hearing Of Genesis Capital’s Bankruptcy Case Is Scheduled: Check Details

According to court filings, the first hearing in Genesis Capital’s bankruptcy case will be held on January 23 at 2:00 p.m. Eastern Time. The case will be heard by Judge Sean H. Lane of the United States Bankruptcy Court for the Southern District of New York.

Companies in Chapter 11 bankruptcy may offer a restructuring plan to creditors while continuing to operate, according to Mark Pfeiffer, a bankruptcy attorney with the law firm Buchanan Ingersoll & Rooney.

The court will determine whether to accept the Chapter 11 relief sought by Genesis Global Holdco and two of its lending business subsidiaries, Genesis Global Capital and Genesis Asia Pacific (together known as Genesis Capital), as the first stage in the bankruptcy proceedings. The firms also demanded cooperative administration of the proceedings.

As part of the procedures, the United States Trustee will establish a committee for unsecured creditors. The committee will have the authority to require consultation with the firms before making important decisions or adjustments, as well as to participate in the restructuring plan. According to court papers, the committee is normally composed of twenty of the biggest unsecured creditors.

The firms filed for bankruptcy on Jan. 19, citing liabilities of up to $10 billion, more than two months after declaring a $175 million exposure to FTX and liquidity concerns triggered by the crypto exchange’s collapse. Withdrawals from Genesis Global Capital’s platform have been halted since November 16.

According to a news release, the Genesis Chapter 11 plan asks for a worldwide settlement of all claims and the establishment of a trust to distribute assets to creditors. The firms will seek a “sale, capital raising, and/or an equitization transaction” as part of a “dual track procedure,” allowing their company to “emerge under new ownership.”

Digital Currency Group (DCG), Genesis Capital’s parent company, reportedly denied participation in the bankruptcy filing, alleging that a special committee of independent directors advised and agreed to file for Chapter 11 bankruptcy protection. Only Genesis’ loan firms have declared bankruptcy. Genesis Global Trading, as well as Genesis’ spot and derivatives trading company, will continue to operate.

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Jeewan Singh is CryptoShrypto’s content writer and a seasoned writer with over two years of experience in writing about Indian Securities Market. Jeewan's participation in Blockchain and Cryptocurrency started in late 2020, and he hasn't looked back since. The technical and economic outcomes of cryptocurrency are what spark his curiosity, and he keeps one eye on the market.
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