February 27, 2024

Media: Genesis crypto lender owes about $1 billion to Gemini exchange clients

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Media: Genesis crypto lender owes about $1 billion to Gemini exchange clients

According to the Financial Times, the servicecryptocurrency lending Genesis and its parent company Digital Currency Group (DCG) owed clients of the Gemini exchange more than  $900 million.

Gemini, founded by Tyler and CameronWinklevoss (Tyler, Cameron Winklevoss) is unsuccessfully trying to recover funds after crypto lender Genesis suffered significant losses due to the collapse of FTX. Genesis and DCG owe Gemini clients more than $900 million. At the same time, the share of the venture capital company DCG, which owns Genesis Trading and Grayscale, accounts for the bulk of the debt at $575 million.

Experts note that additionalcomplexity may be caused by the presence of large intra-structural loans. For example, DCG itself owes its subsidiary Genesis about $2 billion. DCG declined to comment, but, as Financial Times journalists learned, part of DCG's loans was used to finance the activities of another subsidiary, Grayscale.

To find a way out of this situation, the exchangeGemini formed a creditors' committee, and Genesis hired investment bank Moelis & Company to explore options, including potential bankruptcy to recover proceeds from the sale of Genesis and DCG assets.

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Previously CEO of a technology companyAva Labs John Wu noted the importance of Genesis Global Capital's role in attracting new investors and said that the collapse of a crypto lender poses a greater risk to the digital asset market than the bankruptcy of the FTX exchange.