Genesis eyeing tax benefits after blocking DCG sale
Bankrupt crypto lender Genesis is reportedly hoping to score a number of tax benefits after it successfully blocked its parent company from offloading or reducing its ownership until the firm’s Chapter 11 proceedings have been completed.
As reported by CoinDesk, Genesis stands to retain benefits on $700 million of “federal net operating loss carryforwards,” providing Digital Currency Group (DCG) keeps hold of at least 80% of the firm.
These carryforwards — which are linked to collapsed crypto hedge fund Three Arrows Capital — may lessen Genesis’ future income tax liability, improve its cash position, and “contribute to a successful reorganization.”
Genesis and DCG agreed a payment plan
Last month, Genesis and DCG came to an agreement over unpaid debts that went overdue in May. However, the deal still has to be approved by creditors.
According to Genesis’ bankruptcy plan, DCG agreed to pay it $295 million in US dollars and bitcoin. This is to be paid in installments by April.
Read more: Genesis wants Gemini’s $700M in ‘unfair’ transfers made before bankruptcy
DCG owes Genesis Global Capital for four loans worth $500 million and just over 4,550 bitcoin borrowed by its international arm. The “partial repayment agreement” brings DCG’s total returns to about $502 million.
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