Cryptocurrency company Digital Currency Group (DCG) and Grayscale are cooperating with bankrupt lender Genesis to support Grayscale’s Bitcoin Trust (GBTC), Grayscale Ethereum Trust (ETHE), and Grayscale Ethereum Classic Trust (ETCG). It opposed the move to sell the assets. According to recent court filings, it amounts to $1 billion.
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In court papers, Grayscale said it could not be forced to redeem the stock at the debtor’s request because it had no advance notice of the situation and no participants were authorized to redeem it.
According to the company:
GBTC Shares, ETHE Shares and ETCG Shares (collectively, “Trust Shares”), which constitute “Restricted Securities”, may not be sold, assigned or otherwise disposed of without the prior written consent of Grayscale, which may be given or withheld at its sole discretion. doesn’t exist. .”
The cryptocurrency company went on to say that complying with Genesis’ request could undermine its ability to ensure compliance with federal securities laws and regulations.
Grayscale therefore respectfully asks the court to deny that portion of the motion seeking to invalidate the consent rights and authorized participant requirements. He also emphasized that the company must conduct standard processes to comply with applicable laws, including federal and state securities laws.
Meanwhile, Grayscale said it does not take a position on whether Genesis should be allowed to sell its assets and has no intention of delaying or impeding the sale.
‘No merit’
DCG argued that Genesis’ motive to sell its assets was “meritless.”
“Given the uncertainty about the Debtor’s plan of amendment and when distributions to creditors may actually occur, it appears that the relief requested by the Debtor is not immediately necessary,” DCG attorneys wrote.
The asset management company recommended delaying the sale of the assets until after the debtor’s plan of amendment hearing. However, if the court finds in favor of the motion, the DCG will urge the appointment of a specialist broker for the property and recommend that they be consulted before a sale takes place.
Last week, DCG opposed approving Genesis’ bankruptcy plan because it made excessive compensation to the detriment of creditors.