Digital Currency Group (DCG) and its bankrupt Genesis subsidiaries reached an in principle agreement on terms of a restructuring plan with a group of the firm’s main creditors, according to a person familiar with the situation.

The agreement, which begins to resolve some of the major issues that sent Genesis into Chapter 11 bankruptcy protection, entails winding down the Genesis loan book as well as the sale of the bankrupt Genesis entities, the person said.

The term sheet also involves refinancing the outstanding loans where DCG borrowed $500 million in cash and about $100 million worth of bitcoin (BTC) from Genesis, the person said. Included is “an equitization of the infamous 10-year promissory note that DCG gave Genesis in return for failed hedge fund 3AC claims,” the person said, without providing details of the process. 3AC refers to Three Arrows Capital, a crypto hedge fund that collapsed last year.

The creditor group has been negotiating on behalf of companies and individuals with claims of around $2.4 billion against the crypto lender, and is represented by law firms Proskauer and Kirkland as well as restructuring banker Houlihan Lokey.

The proposed deal will now be solicited to other creditors, including hundreds of thousands of customers of the Gemini Earn lending product, the person said.

The lending arm of Genesis halted withdrawals on Nov. 16, 2022, in the wake of crypto exchange FTX’s collapse earlier that month. Last week, Genesis‘ lending businesses filed for bankruptcy protection in New York.

The lending arm of Genesis halted withdrawals on Nov. 16, in the wake of crypto exchange FTX’s collapse earlier that month. Last week, Genesis‘ lending businesses filed for bankruptcy protection in New York.

On Monday, Genesis’ lawyers told Judge Sean H. Lane of the U.S. Bankruptcy Court for the Southern District of New York at a hearing that they foresaw reaching a deal with creditors by the end of this week.

Genesis declined to comment. DCG didn't respond to requests for comment by press time.

DCG is also the parent company of CoinDesk.

Read more: Genesis’ Crypto Trading Arm Is Moving Money Around, a Sign of Normality Amid Sibling’s Bankruptcy