Genesis, the bankrupt crypto lender, has completed the redemption of its Grayscale Bitcoin Trust (GBTC) shares, purchasing 32,041 bitcoins (equivalent to $2.2 billion) with the proceeds. The sale of Genesis's GBTC shares was authorized by the bankruptcy court in mid-February 2024 as part of the company's efforts to compensate its creditors.
Crypto Lender Genesis Completes Redemption of Grayscale Bitcoin Trust Shares, Acquires Massive Bitcoin Holdings
Genesis Global Holdco LLC, the bankrupt crypto lender that suffered a financial meltdown in the wake of the FTX collapse, has executed the final sale of its Grayscale Bitcoin Trust (GBTC) shares, marking a significant milestone in its bankruptcy proceedings.
Under a court-approved agreement granted in mid-February 2024, Genesis embarked on a mission to liquidate its substantial GBTC holdings, along with shares in two Grayscale Ethereum trusts, to compensate creditors. The estimated value of these shares at the time was approximately $1.6 billion, with Genesis's GBTC shares alone valued at nearly $1.4 billion.
According to sources close to the matter, Genesis successfully sold its GBTC shares on April 2nd and used the proceeds to purchase a staggering 32,041 Bitcoin (BTC), equivalent to 2.2 billion dollars. The Bitcoin acquisition was calculated at a price of $67,500 per BTC, reflecting the market value at the time of the transaction.
The move by Genesis to acquire a substantial amount of Bitcoin has raised questions about the company's strategic direction in the post-bankruptcy landscape. Industry analysts speculate that Genesis may be positioning itself as a major player in the crypto space, leveraging its newly acquired Bitcoin reserves to bolster its financial health and long-term competitiveness.
However, Genesis currently faces the immediate task of satisfying the claims of Gemini Earn creditors, who have been eagerly awaiting the distribution of their promised tokens. As one of the high-profile victims of the Genesis collapse, Gemini had threatened legal action in May 2023 to recover $630 million owed to its Earn customers. The total debt owed by Genesis to Gemini customers exceeds $900 million.
Despite the challenges facing Genesis, the cryptocurrency market has exhibited a positive trajectory in recent days. As of the time of writing, Bitcoin (BTC) has surged by over 5% compared to its value 24 hours earlier, reaching levels not seen in recent months. The trading volume of BTC has also increased by a remarkable 63% over the past day, indicating a resurgent interest in the digital asset.
The market capitalization of BTC has exceeded 1.430 billion dollars, underscoring the renewed confidence in the cryptocurrency and the potential for a sustained upswing. The Genesis acquisition of 32,041 BTC may further contribute to the market's bullish sentiment and cement the company's position as a significant participant in the digital asset ecosystem.
