Cryptocurrency Genesis declares bankruptcy in the wake of the collapse of the FTX exchange

Genesis, a cryptocurrency lending and trading conglomerate of more than 200 companies, has declared bankruptcy in the wake of the FTX stock exchange crash, the Financial Times reports and was quoted by theverge.

Genesis, one of FTX’s largest lenders, halted withdrawals in November and cut 30% of its staff earlier this month, BBC News reported. Genesis is part of the Digital Currency Group (DCG), which also owns crypto asset manager Greyscale and crypto-focused news outlet CoinDesk.

The bankruptcy follows months of uncertainty at the crypto company, and the Financial Times reported earlier this month that Genesis owes its creditors more than $3 billion, including nearly $1 billion to cryptocurrency exchange clients Gemini Winklevoss, and files for bankruptcy under chapter. 11 Genesis has assets and liabilities in the hundreds of millions of dollars, while one subsidiary – Genesis Global Capital – has assets and liabilities running into the billions, with more than 100,000 creditors.

Genesis Interim CEO Dirar Islam said in a statement: We look forward to moving forward in our dialogue with DCG and our creditor advisors as we pursue a path to maximize value and provide the best opportunity for our business to emerge well-positioned for the future.

The restructuring in court provides the most efficient way in which assets can be preserved and the best possible outcome for all stakeholders in Genesis.”

Last November, several outlets reported that Genesis was trying to raise more than $1 billion from various investors, including Binance. According to the Wall Street Journal, the exchange, which previously said it would buy FTX and then changed its mind, decided not to invest and Genesis now says it has more than $150 million in cash to fund its operations and restructure.

And just like the FTX bankruptcy affected many other parts of the crypto industry, the downfall of Genesis is likely to lead to a cryptocurrency infection.

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