Genesis warns of possible bankruptcy without new financing


Digital asset brokerage Genesis is struggling to raise new money for its lending unit, and the company has warned potential investors that it may have to file for bankruptcy if its efforts fail, according to a report from Bloomberg News. The company has been facing a liquidity crunch since FTX filed for bankruptcy earlier this month and reportedly attempted to raise at least $1 billion (approximately Rs. 8,118 crore) after approaching both Binance and Apollo Global Management. The potential bankruptcy also underscores how the collapse of FTX sent shockwaves through the wider crypto ecosystem that show no signs of abating.

See also  When will Twitter Blue be launched in India? This is what Elon Musk said:

“We have no plans to file for bankruptcy anytime soon,” a Genesis representative said in a statement to Bloomberg. “Our goal is to resolve the current situation by mutual consent without the need for a bankruptcy filing. Genesis continues to engage in constructive discussions with creditors.”

The rush for funding was accelerated by a liquidity crunch at the lender following the sudden collapse of FTX, one of the world’s largest crypto exchanges.

See also  BlockFi Files For US Bankruptcy, Cites FTX Exposure

Genesis Global Capital, the lender of Genesis Trading, temporarily suspended repayments and new loans last week in the wake of the collapse of FTX and the implosion of Three Arrows Capital earlier this year. At the time, parent company Digital Currency Group said business operations at DCG and its other wholly owned subsidiaries were not affected.

DCG gave Genesis Trading a $140 million (approximately Rs. 1,136 crore) equity injection after it said its derivatives firm had locked up $175 million (approximately Rs. 1,420 crore) on the FTX platform. “Genesis has no material exposure to FTT or other tokens issued by centralized exchanges,” the company said. said in a tweet on November 9.

See also  Don't stay too long in a trending market

The news shocked crypto investors as Bitcoin extended its intraday slump to just $15,649 (approximately Rs. 12.7 lakh), though the token has since erased some of those losses, currently priced at $15,732 (approximately Rs. 12. 77 lakh).

Affiliate links may be generated automatically – see our ethics statement for details.



Please enter your comment!
Please enter your name here