Genesis Global Trading, the cryptocurrency lending unit of the Digital Currency Group, has filed a motion requesting the authorization of the sale of its trust assets, which include Bitcoin and Ether-based funds valued at approximately US$1.6 billion.
Most of the lender’s assets are managed by Grayscale, a U.S. cryptocurrency asset manager behind Grayscale Bitcoin Trust (GBTC), formerly the largest Bitcoin fund in the world. GBTC became a spot Bitcoin exchange-traded fund last month as the Securities and Exchange Commission (SEC) approved 11 spot Bitcoin ETF applications.
Genesis had around US$1.4 billion in GBTC, US$165 million in Grayscale’s Ethereum Trust, and US$38 million in the fund manager’s Ethereum Classic Trust, according to the motion filed last Friday.
The court’s approval is pending for this significant liquidation, which could add to some of the bankruptcy developments around the cryptocurrency industry.
Celsius Network, another U.S.-based cryptocurrency lender, emerged from its bankruptcy last week and announced the start of its US$3 billion payout. The bankruptcy team of FTX, a cryptocurrency exchange founded by Sam Bankman-Fried, unveiled its plans to repay its customers. FTX said it has recovered at least US$7 billion to repay its customers.
Last week, Genesis and crypto exchange Gemini settled with the SEC for US$21 million in an unregistered securities offering case related to Gemini’s lending product.
Genesis filed for bankruptcy protection last year following a wave of bankruptcies following a wave of major bankruptcies in the cryptocurrency industry, headlined by FTX.