Genesis Capital has filed for bankruptcy in the Southern District of New York. The collapse of the Three Arrows Capital fund and the FTX exchange led to this decision.
Genesis Capital closed withdrawals for clients on November 16th. The company had $175 million blocked on the FTX exchange. Without these funds, the crypto-creditor experienced a significant liquidity crisis and, despite the measures taken, it was not possible to save the company. At the same time, on January 4, the management said that the trading platform remains fully operational.
One of the latest blows to the company’s business was the accusation of Genesis Capital in an unregistered sale of securities. The U.S. Securities and Exchange Commission (SEC) filed a charge against the Gemini Earn product on January 12.
Recall that the Genesis crypto lender belongs to Digital Currency Group. In addition to Genesis Capital, the company’s portfolio includes cryptocurrency publication CoinDesk and asset management company Grayscale. It was previously reported that DCG could sell the publication to CoinDesk for $200 million. At the same time, in 2017, the publication was bought by the current owner for only $500,000.
Source: Bits
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