Cameron and Tyler Winklevoss.

Adam Jeffery | CNBC

Crypto exchange Gemini will contribute up to $100 million in cash, earmarked for its customers, as part of an agreement with bankrupt Genesis Global Capital and parent Digital Currency Group, Genesis’ lawyers said in a court hearing on Monday.

The restructuring deal and recovery plan were announced during a status conference for crypto lender Genesis, which filed for bankruptcy protection in New York on Jan. 19. Genesis owed its creditors, including Gemini and its users, billions of dollars.

Gemini, founded by Cameron and Tyler Winklevoss, had been engaged in a high-profile back-and-forth with Barry Silbert, who owns DCG. The Winklevoss twins have publicly blamed Silbert’s mismanagement of Genesis for issues with one of its own products called Earn, which promoted returns of up to 8% on customer deposits.

“This plan is a critical step forward towards a substantial recovery of assets for all Genesis creditors,” Gemini told its users in correspondence viewed by CNBC. It demonstrates “Gemini’s continued commitment to helping Earn users achieve a full recovery.”

The broader details of the restructuring plan were announced in Manhattan bankruptcy court. The deal, cut between Genesis, DCG, Gemini, and Genesis’ range of creditors, is largely predicated around a refinancing of Genesis’ loans to DCG. Genesis loaned over $500 million worth of cash and bitcoin to DCG, in part to fund founder Silbert’s venture investments.

DCG will also contribute to Genesis “all equity” in Genesis’ trading subsidiary, which remained operational during the bankruptcy. Additionally, DCG will provide a two-tranche debt facility, maturing in June 2024, with 11% interest on one tranche, and a 5% interest-paying bitcoin tranche, “roughly equal to around $500 million,” a Gensis lawyer said.

DCG will also issue convertible preferred stock to Genesis creditors.

DCG also extended a $1.1 billion promissory note to Genesis after crypto hedge fund Three Arrows Capital collapsed. The Winklevoss brothers blasted that maneuver as “a complete gimmick that did nothing to improve Genesis’ immediate liquidity position or make its balance sheet solvent.”

As part of the recovery plan, that promissory note will be equitized, meaning it will be converted into something of substantive value, typically equity, CoinDesk reported.

“Thank you for putting your trust in us during this challenging time,” Gemini said in its message to users.

For months, Gemini customers loaned money to Genesis for placement across various crypto trading desks. When Genesis halted its lending business following the collapse of FTX in November, Gemini Earn was forced to temporarily shutter its operations, as well.

All withdrawals on Earn have been paused for nearly three months. Gemini’s 340,000 retail clients are angry, and some have come together in class actions against Genesis and Gemini.

The Securities and Exchange Commission complaint filed charges against both Gemini and Genesis on Jan. 12, for allegedly selling unregistered securities in connection with a high-yield product offered to depositors.

WATCH: Crypto broker Genesis files for Chapter 11 bankruptcy

Crypto broker Genesis files for Chapter 11 bankruptcy

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