The changes could see creditors lose almost 40% of their original investments
Gemini Earn creditors are upset over the company’s proposed reorganization plan, which could see the Bitcoin payouts promised virtually cut to about 30% of their current worth on the market.
In a recent X post (formerly Twitter), Gemini Trust announced it sent creditors details of the proposed plan in an email on December 13, which has now been put up for a vote. The proposed plan states that creditors will receive a payout equivalent to their Earn crypto balances as of January 19, 2023, which is when Gemini’s crypto lending partner, Genesis Global Capital, filed for bankruptcy.
Earn Update: Solicitation of the Genesis Plan of Reorganization (Plan) began today. Earn users were sent an email with specific instructions on how to vote on the Plan and a link to the Genesis Solicitation Package, including the Disclosure Statement.
The voting deadline is…
— GeminiTrustCo (@GeminiTrustCo) December 13, 2023
Bitcoin and Ether prices at that time were only $20,940 and $1,545. They have since risen to $42,750 and $2,250, respectively. The worst-case scenario is creditors being given a 61% recovery, with each Bitcoin creditor held on Earn being paid out at $12,773, or 30% of Bitcoin’s current value.
Comments on Gemini’s X post emerged in harsh opposition, with many insisting that creditors “VOTE NO.” One comment from Andrew Aleid said: “I vote no because this is a spit in our faces. Absolute disgrace.” Another user named Leslie responded by saying, “You stole our money. Give it ALL back, every single dollar.”
The Gemini Earn program provided users with earned interest in cryptocurrencies. Before going bankrupt, Gemini withdrew hundreds of millions of dollars from Genesis to enable the program. The crypto exchange is now pursuing the recovery of $1.6 billion from Genesis for Earn customers.
Creditors have until 4 PM EST on January 10, 2024, to vote on whether to accept or reject the Gemini plan. If accepted, the bankruptcy court handling the case will determine whether to give final approval on February 14, 2024.
Emma Rodriguez is the Proofreader at the Big Blind, with seven years of experience and five years in online gambling. She plays a crucial role in maintaining content quality by ensuring error-free, reader-friendly information about the gambling industry.
