Genesis Owes the Customers of Gemini $900 Million

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Last Updated on December 4, 2022 by Bitfinsider

The Financial Times reported on Saturday that crypto broker Genesis and its parent business Digital Currency Group (DCG) owe clients of the Winklevoss twins’ crypto exchange Gemini $900 million.

Genesis was caught off guard by the failure of Sam Bankman-FTX Fried’s crypto organization last month, the newspaper reported, citing sources with knowledge of the situation. Gemini is attempting to recover the assets.

The venture capital firm Digital Currency Group, which owns Genesis Trading and cryptocurrency asset management Grayscale, owes $575 million to Genesis’ crypto lending arm, CEO Barry Silbert of Digital Currency Group disclosed to shareholders last month.

Gemini, which operates a crypto loan product in conjunction with Genesis, has now organized a creditors’ committee to reclaim the monies from Genesis and its parent company DCG, according to the article.

Three sources familiar with the situation told the New York Times last month that Genesis had recruited investment firm Moelis & Company to examine options, including a potential bankruptcy.

Genesis Global Capital halted client redemptions in its lending business last month, blaming the abrupt collapse of the FTX cryptocurrency exchange.

The crypto trading site FTX filed for bankruptcy in the United States on November 11 in the most high-profile crypto meltdown to date, after traders withdrew billions from the platform in three days and rival exchange Binance abandoned a rescue arrangement.

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