TechFlow News — Genesis Global Capital has filed a lawsuit against its former business partner, Gemini Trust, seeking the return of over $689 million.
Genesis alleges that Gemini made "preferential" transfers before bankruptcy, harming the interests of other creditors. This legal dispute originated from the FTX collapse, after which Genesis filed for bankruptcy in January. Gemini subsequently sued Genesis's parent company, Digital Currency Group (DCG), in July, and in September, Genesis countersued DCG to recover more than $600 million in loans.
In October, Gemini filed another lawsuit against Genesis involving approximately $1.6 billion worth of shares in the Grayscale Bitcoin Trust (GBTC). Last month, the New York Attorney General also sued DCG, Genesis, and Gemini, accusing them of defrauding over 230,000 investors.
Court documents state that during market turmoil triggered by the collapse of LUNA and TerraUSD, Gemini conducted "unprecedented withdrawals," exacerbating Genesis's insolvency. Within the 90 days prior to bankruptcy, Gemini demanded repayment of prior loans from Genesis, and these transfers are considered "avoidable" because Genesis was allegedly "insolvent" at the time.
