The significant Bitcoin purchase comes after Coinbase declared that the majority of the proceeds from the GBTC sell-off would “remain within the crypto ecosystem.”
Bankrupt crypto lending firm Genesis reportedly offloaded about 36 million shares of the Grayscale Bitcoin Trust (GBTC) to acquire additional Bitcoin as part of its preparations to settle its debts with creditors.
According to a recent Bloomberg report, Genesis liquidated approximately 36 million GBTC shares on April 2, valued at approximately $58.50 per share at that time.
The share price has climbed by approximately 50% since Genesis initially sought permission from a United States bankruptcy court to sell the 36 million GBTC shares on Feb. 2, when the shares were at $38.50.
The total sale amount came to $2.1 billion, which allowed the purchase of 32,041 Bitcoin on April 2 at a price of $65,685. Genesis will use Bitcoin to continue its efforts to repay creditors.
At the time of publication, the 32,041 Bitcoin is currently worth $2.18 billion.
Recently, cryptocurrency exchange Coinbase assured the community that the sell-off was not expected to have a wider impact on the crypto market.
“Our view is that much of these funds will likely remain within the crypto ecosystem, contributing to a neutral overall effect in the market,” Coinbase stated.
It explained that the rules of the bankruptcy plan allowed Genesis to either convert shares of the GBTC into the underlying Bitcoin asset on behalf of the creditors or sell the shares outright and distribute the cash.
This comes after the Digital Currency Group (DCG) argued that its subsidiary company Genesis has proposed paying its customers more than they are entitled to.
On Feb. 6, Cointelegraph reported that DCG claims Genesis’s current plan would see “hundreds of millions of dollars more than the full amount of their petition date claims” go to lenders.
Genesis filed for Chapter 11 bankruptcy in January 2023.
Source: Cointelegraph.com
