In a dramatic turn of events, Genesis, the now-bankrupt
crypto lender, has brought its entire crypto trading venture to an abrupt halt.
The decision to cease all trading operations, including its international spot
and derivatives trading services, has occurred amid legal disputes involving FTX and
Gemini.
Genesis Global Trading,
a subsidiary of Genesis Global, recently announced its plans to close U.S.-focused spot crypto
trading operations by the end of this month, a report by Coindesk indicated.
GGT will cease its over-the-counter trading platform’s operations on September
18, 2023.
While Genesis Global
Trading is winding
down its U.S. operations,
Gensis Global Capital International Limited (GGC), another trading-focused entity affiliated with
Genesis, will reportedly continue operating GGT’s spot and derivatives trading
services. GGT was one of Genesis Global’s subsidiaries that escaped the
conglomerate’s bankruptcy.
Genesis Global’s recent
troubles involved a dispute with the now-bankrupt cryptocurrency exchange, FTX,
which claimed that Genesis owed it a staggering USD $2 billion. About two weeks
ago, Finance Magnates reported that
FTX had agreed to settle its claims dispute with Genesis by accepting a payment
of USD $175 million to Alameda Research, its affiliated crypto hedge fund.
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This agreement offered
the potential for substantial recoveries, ranging from 70% to 90% in USD equivalent for
unsecured creditors. Genesis faced instability following FTX’s collapse and its
eventual bankruptcy filing earlier this year.
In an effort to address
existing liabilities, Digital Currency Group, (DCG) which is also Genesis’ parent company, has devised a strategic
repayment plan. The lending platform has a substantial unsecured loan totaling
approximately USD $630 million that was due in May 2023 and an additional USD
$1.1 billion under an unsecured promissory note that matures this year.
Ongoing Legal Disputes
with Gemini
In addition, Genesis has
an ongoing legal dispute involving Gemini’s allegations of fraudulent activity.
Gemini sued DCG and its CEO, Barry Silbert, in July,
contending that both parties were involved in ‘encouraging and facilitating’
fraudulent activity through Genesis.
In response, DCG
dismissed these claims as baseless and defamatory, asserting that they were
orchestrated as a ‘publicity stunt’ by Gemini’s Co-Founder, Cameron Winklevoss.
Genesis found itself in
financial trouble when it filed
for bankruptcy protection in
New York following the collapse of Three Arrows Capital (3AC) and FTX. According to the Ad Hoc Group, Genesis faced
significant exposure of $2.3 billion to 3AC, which was subsequently reduced to
$1.2 billion after the collateral was liquidated.
GGC
primarily catered to institutional clients and boasted a substantial $2.8
billion in active loans as of the end of the third quarter of 2022. The firm
temporarily suspended customer withdrawals and new loan originations last year.
In a dramatic turn of events, Genesis, the now-bankrupt
crypto lender, has brought its entire crypto trading venture to an abrupt halt.
The decision to cease all trading operations, including its international spot
and derivatives trading services, has occurred amid legal disputes involving FTX and
Gemini.
Genesis Global Trading,
a subsidiary of Genesis Global, recently announced its plans to close U.S.-focused spot crypto
trading operations by the end of this month, a report by Coindesk indicated.
GGT will cease its over-the-counter trading platform’s operations on September
18, 2023.
While Genesis Global
Trading is winding
down its U.S. operations,
Gensis Global Capital International Limited (GGC), another trading-focused entity affiliated with
Genesis, will reportedly continue operating GGT’s spot and derivatives trading
services. GGT was one of Genesis Global’s subsidiaries that escaped the
conglomerate’s bankruptcy.
Genesis Global’s recent
troubles involved a dispute with the now-bankrupt cryptocurrency exchange, FTX,
which claimed that Genesis owed it a staggering USD $2 billion. About two weeks
ago, Finance Magnates reported that
FTX had agreed to settle its claims dispute with Genesis by accepting a payment
of USD $175 million to Alameda Research, its affiliated crypto hedge fund.
Keep Reading
This agreement offered
the potential for substantial recoveries, ranging from 70% to 90% in USD equivalent for
unsecured creditors. Genesis faced instability following FTX’s collapse and its
eventual bankruptcy filing earlier this year.
In an effort to address
existing liabilities, Digital Currency Group, (DCG) which is also Genesis’ parent company, has devised a strategic
repayment plan. The lending platform has a substantial unsecured loan totaling
approximately USD $630 million that was due in May 2023 and an additional USD
$1.1 billion under an unsecured promissory note that matures this year.
Ongoing Legal Disputes
with Gemini
In addition, Genesis has
an ongoing legal dispute involving Gemini’s allegations of fraudulent activity.
Gemini sued DCG and its CEO, Barry Silbert, in July,
contending that both parties were involved in ‘encouraging and facilitating’
fraudulent activity through Genesis.
In response, DCG
dismissed these claims as baseless and defamatory, asserting that they were
orchestrated as a ‘publicity stunt’ by Gemini’s Co-Founder, Cameron Winklevoss.
Genesis found itself in
financial trouble when it filed
for bankruptcy protection in
New York following the collapse of Three Arrows Capital (3AC) and FTX. According to the Ad Hoc Group, Genesis faced
significant exposure of $2.3 billion to 3AC, which was subsequently reduced to
$1.2 billion after the collateral was liquidated.
GGC
primarily catered to institutional clients and boasted a substantial $2.8
billion in active loans as of the end of the third quarter of 2022. The firm
temporarily suspended customer withdrawals and new loan originations last year.
