Genesis Ends All Trading Services Amid Bankruptcy, Unpaid Loans
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Genesis Global Trading, a once dominant player in the cryptocurrency trading arena, has announced the discontinuation of its global trading services. The decision follows the bankruptcy filing of Genesis Global Holdco, a related entity within the same digital-asset conglomerate, earlier this year.
Genesis is now liaising with regulatory authorities to ensure a smooth and orderly cessation of services.
Genesis Sunsets Global Trading Services
The closure extends to all trading services offered by Genesis, including spot and derivatives transactions facilitated through GGC International Ltd. This entity, a British Virgin Islands company, is wholly owned by Genesis Bermuda Holdco Ltd.
The company’s spokesperson confirmed that the decision was made,
“Voluntarily and for business reasons.”
The firm initially announced that it would be shuttering its US trading services in early September.
Genesis, an affiliate of Barry Silbert’s Digital Currency Group, was a prominent derivatives trading desk. Since its inception in 2013, the firm has handled a staggering $116.5 billion in spot trading, making it one of the top institutional derivatives desks by volume.
As recently as the third quarter of last year, the firm reported trading $18.7 billion worth of derivatives.
Trouble With Bankruptcy Plan
However, the company’s fortunes took a turn when Genesis Global Holdco filed for bankruptcy in January. The filing revealed that Genesis Global Capital (GGC), a crypto lender and another affiliate within the conglomerate, had initiated a lawsuit against its parent company, Digital Currency Group (DCG), for failing to repay approximately $630 million in loans.
Genesis alleges that it extended multiple loans to DCG, which remain unpaid. The loans, provided in Bitcoins (BTC), were converted to a fixed-term loan with a maturity date of May 11, 2023. Despite the term completion, Genesis has yet to receive repayment.
Read more: How To Get a Crypto Loan? A Step-by-Step Guide
The announcement of Genesis Global Trading’s closure comes amid concerns about Genesis’ bankruptcy plan. Crypto exchange Gemini has disputed the plan, arguing that it lacks clarity and crucial information for creditors.
Genesis’ plan suggests that unsecured creditors may receive 70% to 90% of their owed amount in USD. Also included are in-kind recoveries ranging from 65% to 90%, depending on asset allocation.
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