Genesis Global Capital, a subsidiary of troubled Genesis Global Holdco, has filed a petition with the U.S. Bankruptcy Court for the Southern District of New York, seeking permission for a substantial sale of assets. The company aims to liquidate around $1.4 billion worth of Grayscale Bitcoin Trust (GBTC) shares, considering it a crucial step to maximize estate value and efficiently manage assets, according to a court filing on Feb. 2.
The urgency in the motion is evident, and Genesis has simultaneously requested an expedited proceeding, aligning with the court’s hearing scheduled for Feb. 8. The move to swiftly convert GBTC shares into more liquid assets is seen as a strategic effort to stabilize amidst severe fluctuations in the overall cryptocurrency market.
Genesis holds a significant number of GBTC shares, representing a specific portion of Bitcoin (BTC) and providing investors with a regulated means of exposure to cryptocurrency price movements. These shares are part of the original collateral for Gemini’s Earn program and include holdings acquired during the Three Arrows Capital collapse.
The filing also mentions a claim to an additional 31.2 million GBTC shares, valued at around $1.2 billion. These assets are pledged to Gemini but are currently in legal limbo with unsettled ownership. Gemini has cautiously welcomed the motion, emphasizing its importance following the recent approval of GBTC as an exchange-traded product.
The liquidation plans extend to assets related to Ether (ETH) and Ethereum Classic (ETC), reinforcing Genesis’ focused strategy to increase liquidity and facilitate creditor remuneration. With the sale involving a substantial quantity of GBTC, equivalent to approximately 3.2% of Bitcoin’s total circulating supply, potential implications for the broader market are noteworthy.
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