Genesis Global Capital denied having imminent plans for the bankruptcy filing by disclosing its priority to hold constructive conversations with the creditors.
Genesis Exposure to FTX Downfall
Genesis, a popular cryptocurrency lender, disproved current speculations of initiating bankruptcy proceedings if unable to bridge the $1 billion shortfall attributed to the sudden FTX Group downfall. While it admitted facing difficulties raising working capital for the lending unit, Genesis’ spokesperson refuted the bankruptcy filing. Instead, the lender’s spokesperson declared its desire to resolve the challenge consensually.
The speculation for plans to file for bankruptcy traces to the November 16 announcement indicating Genesis temporarily halted customer redemptions. Further, the announcement attributed to the unprecedented market turbulence following the FTX Group collapse. In an earlier communication conveyed during the November 10 briefing, Genesis admitted facing a liquidity crunch as $175 million remained locked in the FTX Trading account.
Search for Fresh Liquidity Source
The presser conveyed by the interim chief executive Derar Islim that Genesis Global Capital was serving institutional client base and, by the third quarter, had an active loans book of $2.8 billion. While announcing the temporarily suspension of loan originations, Derar clarified that Genesis Trading was an independently capitalized dealer for Genesis Global Capital. The remarks expressed hope for Genesis Global Capital securing fresh liquidity.
The devotion to secure extra funding saw Genesis Global Capital approaching crypto exchange Binance for a bailout. Insiders privy to the conversations indicated that Binance overlooked the deal citing the acquisition would yield a conflict of interest. Efforts by Genesis to raise new $1 billion capital necessitated it to approach private equity provider Apollo Global Management. To date, Apollo is yet to convey a decision toward funding Genesis.
Genesis Global Capital Counterparties
Genesis Global Capital’s woes trace to the huge losses it suffered earlier this year following the downfall of Three Arrows Capital (3AC). However, it has suffered harsher punishment following the implosion of FTX and Alameda Research that triggered mass withdrawal requests that strangled its liquidity. Its parent company – Digital Currency Group (DCG) had declared a $140 million equity infusion welcomed by Genesis counterparties including Gemini, Tether, and Galaxy Digital (GLXY).
Galaxy Digital suffered a similar fate as Genesis Global Capital as it reported $76.8 million exposure to the FTX collapse. Galaxy refuted the exposure to Genesis lending operations. Circle – the issuer of USDC stablecoin – acknowledged that Genesis remained its counterparty within the Circle Yield. The announcement made on November 17 affirmed that its $2.6 million outstanding loans featured robust collateral agreements while other balances were overcollateralized.
The post Crypto Lender Genesis Global Capital Dismisses Imminent Bankruptcy Filing Following FTX Collapse appeared first on CryptocyNews.com.
from CryptocyNews.com https://www.cryptocynews.com/crypto-lender-genesis-global-capital-dismisses-imminent-bankruptcy-filing-following-ftx-collapse/
via Bitcoin News
via Bitcoin News Today
No comments:
Post a Comment