Genesis Global Capital Bans Bitcoin, Crypto Withdrawals

Following the implosion of FTX and the locking up of over $175 million, Genesis’s lending arm faces a liquidity crisis and is actively seeking new capital.Following the implosion of FTX and the locking up of over $175 million, Genesis’s lending arm faces a liquidity crisis and is actively seeking new capital.Cryptocurrency lender Genesis Global Capital has paused withdrawals and loan applications following the collapse of FTX Exchange, per a tweet from Genesis Trading.Genesis Global Capital boasts an institutional clientele with over $2.8 billion in active loans. Genesis Trading is the broker arm for Genesis Capital. It is independent and capitalized from the larger lending institution, Derar Islim, interim CEO. Islim did however state that trading operations and custody services are still operational. “Today Genesis Global Capital (Genesis’s lending company) made the difficult decision of suspending redemptions and new loan originations,” Amanda Cowie, vice-president of communications at Digital Currency Group, parent company of Genesis, stated. Islim also said that Genesis was actively looking for solutions to its liquidity crisis and would be seeking out “fresh liquidity” sources, according to the report. Cowie stated that this decision was taken in response to extreme market dislocations and loss of industry trust caused by the FTX collapse. Genesis disclosed that FTX had over $175 million in locked assets. DCG was able to provide a $140m equity infusion following the collapse of FTX. Gemini Earn is Genesis’ lending partner. Genesis cannot honor withdrawals and Genesis serves as its lending partner. Gemini stated that while they are disappointed that the Earn program [service contract] will not be fulfilled, they are encouraged by Genesis and Digital Currency Groups’ commitment to fulfilling their obligations to customers under this Earn program. Tagsterms:GenesisFTXGenesis capitalGemini

 

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