On Thursday, January 19, crypto lender Genesis Global finally filed for Chapter 11 bankruptcy protection in the Manhattan federal court. This makes Genesis the latest victim of the series of bankruptcies caused by the collapse of the crypto exchange FTX.
Since the collapse of the crypto exchange FTX, Genesis has been facing severe withdrawals and massive liquidity issues. Furthermore, Genesis has its own $175 million stuck on FTX as the crypto exchange collapsed and filed for bankruptcy.
Last month, Genesis had to suspend withdrawals thereby leaving its major client Gemini in trouble. Through its Chapter 11 bankruptcy, Genesis Global has proposed a roadmap to an exit that provides a framework for global resolution and trust to distribute assets to its creditors.
Currently, crypto lender Genesis has been negotiating with the creditors, however, the two parties haven’t been able to attain a fruitful resolution yet. The crypto lender is currently having more than $150 million cash on its hands.
It believes that this would provide them with ample liquidity for supporting its ongoing business operations while facilitating the restructuring process. Genesis and its parent group DCG have been evaluating the most effective path to preserve the assets while moving the business forward.
