Digital Currency Group (DCG) has filed a lawsuit against its subsidiary, Genesis Global Capital, demanding repayment of a $1.1 billion promissory note stemming from the 3AC default. This action highlights ongoing financial tensions within the crypto lending sector as Genesis navigates bankruptcy proceedings. DCG claims that Genesis unfairly profited from asset recoveries exceeding the note’s value, primarily through Grayscale Bitcoin Trust shares and 3AC collateral. The lawsuit adds a layer of complexity to Genesis’s restructuring efforts while signaling potential risks for asset recovery in bankruptcies. Despite the legal action, the crypto market witnessed minimal immediate volatility following the Genesis bankruptcy, indicating investors have already factored in the risk. The future legal proceedings will likely shape financial stability practices and guide regulatory norms within the cryptocurrency industry.