Crypto Lending Company Genesis Files For Bankruptcy

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Genesis, a crypto lending and trading conglomerate of more than 200 companies, has filed for bankruptcy following the collapse of the FTX exchange, reports the Financial Times. Genesis, one of FTX’s biggest lenders, previously suspended withdrawals in November and cut 30% of its staff earlier this month, BBC News reports. Genesis is part of the Digital Currency Group (DCG), which also owns cryptocurrency asset manager Greyscale and crypto-focused news outlet CoinDesk.

The bankruptcy follows months of uncertainty at the crypto company. The Financial Times reported earlier this month that Genesis owes creditors more than $3 billion, including nearly $1 billion to clients of crypto exchange Winklevoss Gemini. Its Chapter 11 bankruptcy filings list Genesis assets and liabilities in the hundreds of millions, while a subsidiary Genesis Global Capital has assets and liabilities spanning billions, with more than 100,000 creditors.

His Possible Genesis Downfall Could Spread Crypto Contagion Further

We look forward to advancing our dialogue with DCG and our creditor advisors as we seek to implement a pathway to maximize value and provide the best opportunity for our business to emerge well positioned for the future, said the director. Genesis acting general, Derar Islim, in a statement. . An in-court restructuring presents the most effective way to preserve assets and create the best possible outcome for all Genesis stakeholders.

Last November, multiple outlets reported that Genesis had attempted to raise over $1 billion from various investors, including Binance. The exchange, which previously announced it would buy FTX and then changed its mind, has decided not to invest, according to the Wall Street Journal. Genesis now says it has a pot of more than $150 million in cash to fund its operations and restructuring.

Just as the FTX bankruptcy impacted many other parts of the crypto industry (and so did the Three Arrows Capitol bankruptcy, with Genesis saying this incident was one of the reasons for which he had liquidity problems), his possible fall of Genesis could spread the crypto contagion further.

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