Creditors of bankrupt crypto lender Genesis Global Capital (GGC) have expressed their disapproval of a proposed $175 million deal with the defunct exchange FTX, accusing GGC of attempting to manipulate the bankruptcy process. Gemini, which is owed some $766 million by Genesis, said in a Thursday filing that the proposed settlement with FTX is an attempt to buy the support of the FTX Debtors, and their votes. A further ad hoc group of creditors said the bid by FTX to claw back loans from its criminal enterprise was unconscionable.
This is, of course, a perversion of the Chapter 11 process, said the Fair Deal Group, a set of creditors which has not revealed its membership. A spokesperson for Genesis did not immediately respond to CoinDesk’s request for comment. Bankruptcy Judge Sean Lane is due to consider the Genesis-FTX deal at a Sept. 6 hearing in the Southern District of New York.
Gemini and other creditors have previously opposed the DCG deal, and said that Genesis should be stripped of monopoly rights to propose a wind-up plan. In July, Gemini also sued DCG for what it said was “fraud” by Genesis, allegations which DCG in turn described as “defamatory” and a “publicity stunt.”