Genesis Works to Preserve Client Assets and Strengthen Liquidity

Genesis' Strategy Amidst Market Challenges

Genesis, a prominent U.S. crypto firm, is actively working to safeguard client assets and bolster its liquidity. The company is formulating a comprehensive plan, anticipated to take weeks rather than days, to address these challenges. The firm's lending division, Genesis Global Capital, halted customer withdrawals on November 16 due to significant market disruptions following the collapse of the FTX exchange.

Collaborative Efforts and Operational Stability

Under the ownership of Digital Currency Group (DCG), Genesis is engaging with experienced advisors to evaluate the best path forward. The company is committed to avoiding bankruptcy and ensuring its business continuity. Despite the challenges, Genesis reassures that other operations within the company remain fully functional.

Rise and Risks of Crypto Lending

The crypto lending sector, likened to de facto banks in the digital currency world, experienced substantial growth during the pandemic. Genesis played a key role in this boom, managing nearly $3 billion in active loans by the third quarter's end. In the previous year, the company extended $130.6 billion in crypto loans and facilitated $116.5 billion in asset trades.

Impact on Partners and Clients

Genesis and DCG have financial obligations to Gemini, a crypto exchange founded by the Winklevoss twins, amounting to $900 million. This situation has affected Gemini's "Earn" program, which partnered with Genesis for yield generation. Consequently, customers of this program are currently unable to access their funds following Genesis' withdrawal freeze.

Genesis remains focused on developing a sustainable solution to navigate these turbulent times, prioritizing client asset preservation and liquidity enhancement.