Gemini’s Lenders Rebel Against ‘Grudge’ Bitcoin Restructuring Plan
Gemini Earn's lenders are up in arms over the proposed reorganization plan, which will see their promised Bitcoin (BTC) payments cut by 30 percent of their current market value.
In a post on X (formerly Twitter), Gemini Trust said it sent creditors an email on December 13 outlining the proposed plan, which is now up for a vote.
Under the proposed plan, lenders will receive a payout equal to the lenders' earnings starting on January 19, 2023, the day Gemini's cryptocurrency lending partner Genesis Global Capital files for bankruptcy.
Some observers, including Bloomberg exchange-traded fund analyst James Seifert, described the plan as “cruel,” at the time Bitcoin and Ether (ETH) were trading at just $20,940 and $1,545 respectively. Assets at the time of writing were $42,750 and $2,250 respectively.
This can be cruel. It's true that it sounds like a worst case scenario, but Gemini Income users may be getting only 61% of their crypto worth as of January 19, 2023. WOOF.
Even 100% is based on the current price. This ranges from 61-100%.
Bitcoin $20,940 Ethereum $1,545 pic.twitter.com/5SKZnlRjr9
— James Seyff (@JSeyff) December 14, 2023
This means that in a worst-case scenario where lenders offer a 61% recovery, a lender would only be paid $12,773 for every Bitcoin on Earn, or 30% of Bitcoin's value today.
Gemini X post commenters appeared strongly opposed to the plan, with many urging lenders to “no vote”.
#gemini #geminiearn no vote pic.twitter.com/hz3ZrvoxWY
— jeffscottworld (@jeffscottward) December 13, 2023
One X user, Andrew Alleid, said: “I didn't vote no because this is a spit in our face. An absolute disgrace.
“You stole our money. Give everything back, give every dollar,” said another user, Leslie, in response to Gemini Trust's post. she added.
“How can one of your customers believe a word when they've been cheating and lying to us for over a year?” Leslie's comments were made in an effort to reassure Gemini customers that they would not be exposed to the associated risks from Genesis.
Another X user said BC should have everyone back in full. “Anything less than that is unacceptable.”
A year later this is completely crazy. You killed our soul. You hurt our hearts and our health. We give you crypto coins and want our crypto back. The same amount. DCG forced you to do whatever they wanted. You couldn't do anything!!! Unbelievable
— ANNA (@AvaAzadpour) December 14, 2023
Gemini Earn was a program where users got interested in cryptocurrencies. Gemini took hundreds of millions of dollars out of Genesis to facilitate the program before Genesis went bankrupt.
The cryptocurrency exchange is now seeking $1.6 billion from Genesis for users.
Related: New York attorney general accuses Gemini, Genesis, DCG of defrauding investors
Creditors have until January 10, 2024, at 4 p.m. Eastern Time, to accept or reject Gemini's plan.
If the plan is approved, the bankruptcy court will decide whether to grant final approval on February 14, 2024.
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