In the bankruptcy case of Genesis Global, court documents reveal that a seven-person committee has been constituted to represent the interests of unsecured creditors.
Creditors will be represented in court by a committee selected from the 20 largest unsecured creditors, which has the right to be consulted before crucial decisions and the restructuring process.
Members include Amelia Alvarez, Teddy Andre Amadeo Goriss, Richard Weston, Digital Finance Group, SOF International, cryptocurrency exchange Bitvavo, and Mirana Asset Management.
The U.S. Trustee William Harrington appointed the group. In the bankruptcy process, a creditor’s committee must be formed. Bitvavo, with approximately $290 million in exposure, is one of the largest creditors, along with claims of $150 million from Mirana and $37 million from Digital Finance Group.
On January 19th, Genesis Capital, which consists of the loan businesses Genesis Global Capital and Genesis Asia Pacific, filed for bankruptcy, alleging potential liabilities of up to $10 billion.
Two months after discovering liquidity concerns related to the FTX collapse, the firms sought protection under Chapter 11. Since November 16th, withdrawals cannot be processed through the Genesis Global Capital website.
Creditors have filed a securities class action complaint against Digital Currency Group, the parent company of Genesis, and its creator and CEO, Barry Silbert, alleging breaches of federal securities laws on January 24th.
According to the complaint, Genesis engaged in securities fraud by intentionally presenting false and misleading representations to investors and lenders in the digital asset lending market. They claim that Genesis violated Section 10(b) of the United States Securities Exchange Act by making false statements about the company’s financial condition.