Genesis Converts $2.1 Billion Worth of GBTC Shares to Bitcoin to Pay Off Debts Amid Legal Challenges

In a major move to address its financial obligations, cash-lending firm Genesis has converted about 36 million shares of Grayscale Bitcoin Trust (GBTC) into Bitcoin, preparing to pay off its debts and creditors.

The increase was implemented on April 2, with GBTC shares valued at about $58.50 each at the time of filing, according to Bloomberg.

This decision comes after GBTC the stock price has seen a massive 50% increase since Genesis received approval from the US bankruptcy court for a stock sale in early February when the stock was valued at $38.50.

The liquidation of GBTC stock culminated in $2.1 billion in revenue for Genesis, which it used to buy 32,041 Bitcoins at $65,685 per Bitcoin on the same day.

The purchase is aimed at fulfilling the company’s obligations to its creditors, with the acquired Bitcoin currently worth around $2.18 billion.

The cryptocurrency community has been closely following this massive activity, concerned about its impact on the market.

Coinbase, however, has issued a warning, suggesting that the move may have a neutral impact on the market as the funds remain within the cryptocurrency ecosystem.

This is part of Genesis’ bankruptcy plan, which allows the company to either directly convert GBTC shares into Bitcoin to creditors or sell them and distribute the proceeds.

This development follows Digital Currency Group’s claim that its subsidiary, Genesis, is committed to paying its customers more than what they deserve.

Additionally, Genesis recently announced a settlement agreement with the SEC, agreeing to a $21 million payment to settle a civil lawsuit related to its operations, including a temporary suspension of withdrawals from Gemini Earn following the bankruptcy of FTX, providing example of market problems and liquidity challenges.

Genesis’ financial woes came to the fore after an SEC lawsuit led to its bankruptcy early last year.

Additionally, a recent court decision has allowed the SEC’s lawsuit against Gemini and Genesis to proceed, dismissing both companies’ requests to dismiss the lawsuit, which involves the alleged sale of unregistered securities through the Gemini Earn program.

This legislative development underscores the ongoing challenges and regulatory scrutiny facing the cryptocurrency industry.

Presenting a crypto press release (PR)send email to (email protected).