Liquidity crisis of biblical proportions: Genesis Global Capital needs $1 billion by Monday to halt trading in Genesis Block

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(Kitco News) – In the beginning, things might have been good for crypto businesses called Genesis. But after the collapse of FTX, investors found it to be bad as they faced a shapeless void and darkness engulfed the markets.

Hong Kong’s leading retail cryptocurrency operator Genesis Block told its customers on Friday morning that it plans to shut down its OTC trading portal on December 10. The company email also asked customers to withdraw their funds and said they would not accept them. new customers.

Earlier this week, the CEO of Genesis Block told Reuters that they are no longer active in the cryptocurrency markets.

“We have stopped trading,” Vincent Hung told Reuters this week. “We don’t know which counterparty will fail next, so we prefer to close all our positions to restore some of our liquidity.”

According to the report, Genesis Block actually began shutting down its Hong Kong crypto business before FTX filed for bankruptcy. A Genesis Block official was a director at FTX Hong Kong but resigned in early November, and Genesis Block soon cut all ties with the failed exchange.

Genesis Block once operated one of the largest bitcoin ATM networks in Asia. After Genesis Block sold its ATM business in 2021, the ATMs are now managed by CoinHero.

On Thursday night, markets received more bad news from Genesis Global Capital (GGC), another cryptocurrency firm that earlier this week suspended customer refunds in loan cases.

This Genesis has been facing a liquidity shortage of biblical proportions as reports emerged that they were struggling to raise $1 billion before last Monday to continue operations. GGC told customers On November 10, FTX had 175 million dollars. Genesis had $2.8 billion in active loans at the end of Q3 2022.

Genesis’ parent venture capital firm Digital Capital Group (DCG) tweeted on Wednesday morning that the decision to freeze Genesis’ credit division was made “in response to the extreme market dislocation and loss of industry confidence caused by the FTX implosion.”

DCG also owns Grayscale, whose $11 billion worth of bitcoin makes them one of the largest owners in the world.

Monotheistic platforms have also affected Greek astrology as Crypto exchange Gemini, owned by the Winklevoss twins and partnered with Genesis, announced that their Win program was affected by the credit freeze.

“We are working with the Genesis team to help customers recover their funds from the Earning program as quickly as possible,” they wrote, adding that they were “disappointed” that Genesis’ commitments to its customers were not being met under the SLA, but that Genesis and DCG had shown signs of resolving the issues. efforts “concentrated” them.

Blockchain analytics platform Nansen reported Thursday that Gemini saw $570 million in net outflows in 24 hours, more than any other cryptocurrency exchange during the same period.

Friday morning brought news that South Korean cryptocurrency exchange GOPAX has stopped withdrawing principal and interest payments on GOFi, a decentralized finance (DeFi) service that provides products from GGC.

GOPAX said it required the return of all GOFi assets from Genesis before the loan freeze.

On the seventh day since FTX’s bankruptcy filing, stock markets are hoping that cryptocurrency will give them some respite.

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