Genesis Global Capital collapse — what creditors were owed and recovered (2022)
Genesis is the outlier among the US crypto Chapter 11 cases: the plan deliberately did not cap recoveries at the petition-date dollar value of crypto claims, and creditors are measured in the coins they lent. There is no single estate-wide percentage. At the 2 August 2024 effective date, bitcoin creditors received 51% of their coins back (equal to 166% of their petition-date dollar value), ether creditors 66% of their coins (153% of petition-date value), and dollar creditors 100%. The 51% headline is the bitcoin class, the most conservative of the three. The percentages of coins returned and of petition-date dollars diverge because bitcoin and ether rose sharply between the January 2023 petition and the distribution.
Case facts
| Customers lost access | |
|---|---|
| Insolvency filed | January 19, 2023 |
| Business | Lender or yield platform |
| Jurisdiction | United States |
| Procedure | Chapter 11S.D.N.Y. · 23-10063 |
| Owed to creditors | $5,100,000,000Published estimates range $4,750,000,000 to $5,400,000,000 |
| Distributed so far | $4,000,000,000 |
| Recovery | 51%In kind — Creditors received back the same assets they deposited, in the same units. |
| Cause | ContagionThree Arrows default, then FTX collapse triggered a run |
| Case status | Distributions under way |
What happened
Genesis Global Capital was the institutional lending arm of Digital Currency Group's Genesis business and the counterparty behind Gemini's retail Earn programme. It had extended about $2.4 billion to Three Arrows Capital and recovered collateral worth only about $1.2 billion when that fund failed; DCG assumed $1.1 billion of the resulting payable through a ten-year, 1% promissory note. After the FTX collapse, Genesis Global Capital and Genesis Asia Pacific paused all lending and borrowing on 16 November 2022, freezing Gemini Earn users out of their assets.
Genesis Global Holdco and the two lending entities filed for Chapter 11 in the Southern District of New York on 19 January 2023, case 23-10063, before Judge Sean Lane. The court found the debtors insolvent: assets of about $3.3 billion as of 31 January 2024 against claims denominated in digital assets that the court placed at roughly $4.75 billion to $5.4 billion as of 31 December 2023, alongside dollar-denominated claims. Gemini Earn users formed a class of about 232,000 retail customers holding roughly $1.05 billion of asserted claims.
The plan was confirmed on 17 May 2024 and took effect on 2 August 2024, when the estate began distributing about $4 billion in digital assets and cash. Gemini had separately returned about $2.2 billion in kind to Earn users earlier in 2024. Litigation against DCG continues and may augment recoveries.
Charges and enforcement
- Genesis Global Capital: SEC civil action for the unregistered offer and sale of securities through the Gemini Earn programme
- filed January 2023 — settled with a $21 million penalty and a permanent injunction
- payable only after other allowed claims including Earn investors.
- Genesis entities: New York Attorney General civil fraud action over Gemini Earn — settled in 2024 in a deal valued at $2 billion for defrauded investors
- plus a bar on operating in New York; approved by the bankruptcy court in May 2024.
Sources
- Memorandum of Decision, Case 23-10063 (SHL) Doc 1691, S.D.N.Y.Court filing · retrieved 2026-08-21
- Cleary Gottlieb (counsel to the debtors)Primary · retrieved 2026-08-21
- Genesis Global HoldcoPrimary · retrieved 2026-08-21
- U.S. Securities and Exchange CommissionPrimary · retrieved 2026-08-21
- New York State Attorney GeneralPrimary · retrieved 2026-08-21
- CoinDeskSecondary · retrieved 2026-08-21
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