Crypto Genesis is Operating Normally
2022.12.08 00:05
Crypto Genesis is Operating Normally
Budrigannews.com – In an effort to avoid filing for bankruptcy, the crypto lending platform Genesis has informed its customers that its withdrawal freeze is likely to last “additional weeks.”
Derar Islim, Genesis’ interim CEO, wrote to its customers on December 7 and shared it with Cointelegraph: “It will be weeks for them to formulate a recovery plan that could see withdrawals reopened.” Genesis shared this letter with Cointelegraph.
“At this point, we anticipate that it will take additional weeks rather than days for us to arrive at a path forward.”
Additionally, Genesis is “evaluating the most effective path to preserve client assets, strengthen our liquidity, and ultimately move our business forward,” according to the letter. Genesis is “working in consultation with highly experienced advisors.”
“Any remaining Beginning elements remain completely functional,” the letter added.
Beginning Exchanging, the market producer and loaning auxiliary of Computerized Cash Gathering (DCG) first hailed openness to FTX in a Nov. 10 Twitter string, uncovering that it had $175 million in reserves locked on the FTX crypto trade.
That very same day, DCG attempted to provide Genesis with a $140 million cash injection.
However, Genesis Global Capital froze withdrawals on November 16 citing “unprecedented market turmoil” caused by the collapse of FTX, which resulted in “abnormal” withdrawal levels that exceeded its liquidity. This did not appear to resolve the company’s liquidity issues.
After failing to cover a reported $1 billion shortfall in its balance sheet, the crypto lender denied plans to file for bankruptcy on November 21 by saying that it would do so “imminently.”
Genesis confirmed shortly thereafter, on November 22, that the company hired investment bank Moelis & Co. for restructuring services to avoid Chapter 11 bankruptcy.
Customers will be informed of “meaningful developments, including any updates on timing,” Genesis reaffirmed in the letter, stating that it is “committed to being as transparent as possible” to those who are affected.
