The bankruptcy of the crypto lending platform Genesis has led to a legal battle against the cryptocurrency exchange Gemini, seeking to reclaim a staggering $689 million.
According to CoinDesk, Genesis has accused Gemini, owned by the Winklevoss twins, of making substantial withdrawals just before Genesis filed for bankruptcy. These withdrawals allegedly triggered a "run on the bank," exacerbating the financial situation.
The lawsuit contends that Gemini conducted preferential transfers totaling approximately $689,302,000 from Genesis, favoring their own interests over other creditors. Genesis has petitioned the court to rectify this perceived unfairness.
The feud between Genesis and Gemini emerged publicly following the collapse of the cryptocurrency exchange FTX, previously led by CEO Sam Bankman-Fried. Genesis initiated bankruptcy proceedings in January, followed by a legal dispute involving its parent company, Digital Currency Group (DCG), which was sued by Gemini in July. DCG characterized the allegations as "defamatory" and a "publicity stunt."
Subsequently, Genesis counter-sued DCG in September, aiming to recoup multiple loans totaling over $600 million. In October, Gemini retaliated by suing Genesis for control over 60 million shares of the Grayscale Bitcoin Trust (GBTC), valued at around $1.6 billion.
Adding to the complexity, all three entities—Gemini, Genesis, and DCG—face a lawsuit filed by New York's Attorney General.
Amidst this crypto turmoil, Binance Founder Changpeng Zhao, commonly known as CZ, announced his resignation as the CEO of the world's largest cryptocurrency exchange. This decision comes following his guilty plea to federal charges and an agreement to pay a substantial $4.3 billion in fines. Additionally, Binance Holdings Limited, the operating body behind Binance.com, has pleaded guilty and will pay over $4 billion to settle a US Justice Department investigation into various violations.
(With Agency Inputs)
ALSO READ | CEO of Binance Pleads Guilty, Resigns, and Agrees to $4.3 Billion in Fines
ALSO READ | Binance’s Bitcoin trading volume dips 48% amid reintroduced fees
