A seven-member committee has been appointed to represent the interests of unsecured creditors in Genesis Global’s bankruptcy case, according to a Feb. 4 court filing.
The committee will represent creditors in court, have the right to ask questions before major decisions and participate in reorganization plans. Members generally choose from a list of the twenty largest unsecured creditors.
Among the selected members are Mirana Asset Management – the arm of crypto exchange Bybit, SOF International, Digital Finance Group, and crypto exchange Bitvavo, along with three individual creditors Amelia Alvarez, Richard Weston, and Teddy Andre Amadeo Goriss.
The group was appointed by William Harrington, a representative of the United States Trustee – an executive branch agency in the Department of Justice responsible for overseeing bankruptcy cases. The formation of the creditors’ committee is an important step in the bankruptcy process.
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With more than $290 million of exposure, Bitvavo sits among the largest creditors, along with claims of Mirana with $150 million and $37 million from Digital Finance Group.
Genesis Global Holdco and its credit subsidiaries, Genesis Global Capital and Genesis Asia Pacific – collectively known as Genesis Capital, filed for bankruptcy on January 19, citing debts of up to $10 billion.
The companies filed for Chapter 11 relief two months after revealing liquidity problems stemming from the collapse of crypto exchange FTX. Withdrawals have been issued from the Genesis Global Capital platform since November 16.
On January 24, a group of creditors filed a securities class action lawsuit (SCA) against Genesis parent-company Digital Currency Group (DCG), and its founder and CEO Barry Silbert, alleging violations of federal securities laws.
The lawsuit alleges that Genesis committed securities fraud through a scheme to defraud potential and existing lenders of digital assets by making false and misleading statements. In the plaintiff’s view, Genesis deliberately misrepresented its financial condition, in violation of the United States Securities Exchange Act section 10(b).