A seven-member committee has been appointed to represent the interests of unsecured creditors in the Genesis Global bankruptcy case.according to documents filed with the court on February 4.
The committee will represent the creditors in court, have the right to be consulted before making important decisions, and to participate in the reorganization plan.. Members are generally selected from a list of the twenty largest unsecured creditors.
Elected members include Mirana Asset Management —a branch of Bybit cryptocurrency exchange, SOF International, Digital Finance Group and Bitvavo cryptocurrency exchange— along with three individual creditors Amelia Alvarez, Richard Weston and Teddy Andre Amadeo Goriss.
The group was appointed by William Harrington, a representative of the United States Trustee, an executive branch agency within the Department of Justice responsible for overseeing bankruptcy cases.. The formation of a committee of creditors is an important step in bankruptcy proceedings.
With over 290 million dollars of exposure, Bitvavo is among the largest creditors, along with Mirana’s $150 million claims and Digital Finance Group’s $37 million..
Genesis Global Holdco and its lending affiliates, Genesis Global Capital and Genesis Asia Pacific —collectively known as Genesis Capital— filed for bankruptcy on January 19claiming a liability of up to 10,000 million dollars.
The companies filed for Chapter 11 filing two months after revealing liquidity problems due to the collapse of cryptocurrency exchange FTX. Withdrawals from the Genesis Global Capital platform have been suspended since November 16.
On January 24, a group of creditors filed a securities class action lawsuit (SCAfor its acronym in English) against Genesis’ parent company, Digital Currency Group (DCG), and its founder and CEO Barry Silbert, alleging violations of federal securities laws.
The lawsuit claims that Genesis committed securities fraud through a scheme to defraud potential and existing lenders of digital assets through false and misleading statements.. In the plaintiffs’ view, Genesis intentionally misrepresented its financial position, in violation of section 10(b) of the Securities and Exchange Act of the United States.
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