Deutsch한국어 日本語中文EspañolFrançaisՀայերենNederlandsРусскийItalianoPortuguêsTürkçePortfolio TrackerSwapCryptocurrenciesPricingBlogAlertsNewsBuy Crypto With CardWidgetsWalletEarnNFTCoinStats Midas24h ReportPress KitAPI Docs

Genesis Sought $1B Bailout From Investors Before Halting Withdrawals: Report

3M ago
bullish:

1

bearish:

0

image

Crypto lender Genesis tried to raise a $1 billion loan from investors to avoid a “liquidity crunch” driven by the fallout from crypto exchange FTX’s collapse, according to a Wall Street Journal report.

The firm said that it needed the credit by 10 am by this past Monday, but it didn’t get it.

On Wednesday morning, Genesis then announced it would suspend withdrawals from its lending arm, blaming FTX’s collapse for “abnormal withdrawal requests which have exceeded our current liquidity.”

“There is an ongoing run on deposits driven mainly by retail programs and partners of Genesis (i.e., Gemini Earn) and institutional clients testing liquidity,” the document said.

Genesis did not respond immediately to Decrypt's request for comment.

The company said its trading and custody businesses remained “fully operational,” and that Genesis Global Trading, the broker-dealer that is registered with the SEC and holds Genesis’s virtual currency license, is “independently capitalized and operated.”

However, the lender also tweeted that its derivatives business had $175 million in locked funds on its FTX account, though it said this would not impact its market-making activities.

Crypto Liquidity Provider B2C2 Offers to Purchase Loans from Genesis
 

Genesis is still reeling from the implosion of Three Arrows Capital (3AC) earlier this year, with the company saying the $2.3 billion owed by the ex-crypto hedge fund “negatively impacted” the liquidity of its lending arm.

Genesis joins FTX fallout

Genesis joins the growing list of crypto firms impacted by the demise of crypto exchange FTX earlier this month. 

The company founded by crypto “winner” Sam Bankman-Fried filed for Chapter 11 bankruptcy last week, and reportedly owes money to over one million creditors, according to the filing.

FTX-owned crypto exchange Liquid Global and crypto lender SALT both paused withdrawals this week, and a source from popular crypto lender BlockFi told Decrypt the company was mulling bankruptcy after suffering "significant exposure to FTX."

3M ago
bullish:

1

bearish:

0

Manage all your crypto, NFT and DeFi from one place

Securely connect the portfolio you’re using to start.