Thursday, July 25, 2024

Cryptocurrency lender Genesis says there are no immediate plans to file for bankruptcy


(Reuters) – Cryptocurrency lender Genesis said on Monday it had no immediate plans to go bankrupt, days after the collapse of cryptocurrency exchange FTX forced it to suspend customer refunds.

“We have no plans to file for imminent bankruptcy. Our goal is to resolve the current situation by mutual consent without the need for any bankruptcy filing,” a Genesis spokesperson said in a statement emailed to Reuters.

a Report From Bloomberg News, citing sources, that said Genesis was struggling to raise new money for its lending unit, and warned investors that it may need to file for bankruptcy if it can’t find funding.

Also, the Wall Street Journal mentionedciting sources, that the company reached out to cryptocurrency exchange Binance looking for an investment, but Binance decided not to do so, fearing a conflict of interest in the future.

Genesis has also reached out to private equity firm Apollo Global Management (APO.N) For capital assistance, according to the report.

Apollo did not immediately respond to a Reuters request for comment on the WSJ report, while Binance declined to comment.

Last week, Genesis Global Capital suspended customer refunds in its lending business, citing the sudden failure of cryptocurrency exchange Sam Bankman-Fried FTX.

Crypto exchange Gemini, which operates a cryptocurrency lending product in partnership with Genesis, tweeted Monday that it continues to work with the company to enable its users to redeem money from its revenue-generating “earning” program.

In a statement on its blog last week, Gemini said there was no impact on its other products and services after Genesis paused recalls.

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On Thursday, the Wall Street Journal reported that Genesis sought a $1 billion emergency loan from investors before it halted withdrawals.

Earlier this month, FTX filed for bankruptcy protection in the US in the biggest crypto blowout yet, after traders pulled billions from the platform in three days and rival exchange Binance abandoned a bailout deal.

(Reporting by Manya Saini and Lavanya Sushil Ahiri in Bengaluru); Additional reporting by Rishabh Jaiswal. Editing by Sriraj Kaluvella, Rashmi Aish and Sam Holmes

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