Genesis Says It Has No Immediate Plans To Declare Bankruptcy, Seeks Consensual Resolution

Genesis, a digital asset financial services company, has denied that it is on the verge of declaring bankruptcy, just days after halting withdrawals in response to the collapse of crypto exchange FTX.

On Monday (November 21), the cryptocurrency lender stated that it has “no plans” to file for bankruptcy in the near future and will seek a “consensual” resolution to the situation.

In an emailed statement to Reuters, a Genesis spokesperson said, “We have no plans to file bankruptcy imminently. Our goal is to resolve the current situation consensually without the need for any bankruptcy filing.”

According to a report by Bloomberg News, citing sources, Genesis was facing difficulty raising new capital for its lending unit and has warned investors that it may file for bankruptcy if additional funding were not secured.

According to reports, the crypto investment bank has spent the past several days attempting to raise at least $1 billion in new capital.

Furthermore, the Wall Street Journal reported that Genesis approached crypto exchange Binance in pursuit of an investment, but Binance declined due to a potential conflict of interest down the road.

According to reports, the company also approached private equity firm Apollo Global Management for funding.

Genesis Global Capital, one of the largest crypto lenders, suspended customer withdrawals last week due to a liquidity shortage triggered by a rise in withdrawal requests following the collapse of Sam Bankman-Fried’s FTX.

Gemini’s Stance

Gemini, which operates a crypto lending product in partnership with Genesis, tweeted on Monday that it was continuing to collaborate with the firm to help its consumers redeem funds from its yield-generating “Earn” programme.

Gemini stated on its blog last week that the suspension of Genesis withdrawals had no effect on its other products and services.

1/5 Update for Earn customers: we continue to work with Genesis Global Capital, LLC (Genesis) — the lending partner of Earn — and its parent company Digital Currency Group, Inc. (DCG) to find a solution for Earn users to redeem their funds.

— Gemini (@Gemini) November 22, 2022

Also Read: Is FTX Crash An End Of Crypto? Here’s How A Multi Billion Dollar Scam Unfolded