KEY POINTS
Genesis, the bankrupt crypto lending entity, has exchanged about 36 million GBTC shares for Bitcoin, aiming to clear its debt with creditors. The transaction took place on April 2, with each GBTC share priced at roughly $58.50 during the sale, as reported by Bloomberg.
Keen Interest from the Crypto Community
This move follows a notable 50% rise in GBTC share value after Genesis got the green light from the U.S. bankruptcy court to proceed with the sale in early February, when shares stood at $38.50. Genesis garnered $2.1 billion from selling GBTC shares, which it then used to acquire 32,041 Bitcoin, each costing $65,685, on that very day.
The crypto community has kept a vigilant eye on this significant transaction, wary of its possible influence on the market. Coinbase has provided some comfort, indicating that the transaction should have a neutral market impact, since the capital stays within the crypto sphere.
Genesis’s Fiscal Woes
This maneuver is a component of Genesis’s bankruptcy strategy, allowing the firm to either convert GBTC shares directly into Bitcoin for creditors or sell them and distribute the cash. Following this, the Digital Currency Group has reaffirmed its subsidiary Genesis’s pledge to repay its clients more than what they are owed.
Genesis’s fiscal woes intensified following the SEC’s lawsuit, which precipitated its bankruptcy declaration last year. A recent judicial decision also permitted the SEC’s case against Gemini and Genesis to advance, rejecting both firms’ requests to dismiss the case involving charges of marketing unregistered securities via the Gemini Earn program.
