Bankrupt Crypto Lender Genesis Owes Over $3,800,000,000 to Firms Largest 50 Creditors
New documents reveal that embattled crypto lender Genesis owes billions of dollars to its 50 largest creditors.
In recent voluntary bankruptcy filings, the crypto firm divulges that it owes $3.8 billion to its largest creditors, which include hedge fund manager VanEck and the Stellar Development Foundation, the developers of XRP rival Stellar (XLM).
Other prominent creditors include crypto investment firm Digital Finance Group, crypto exchange platform Coinhouse, and crypto lender Gemini. Previously, Genesis and Gemini had collaborated to create Geminis Earn program, which allowed retail investors to loan out their digital assets to earn interest.
Genesis owes about $765 million to members of Geminis Earn program, the highest single amount it owes, according to the documents.
Genesis, a subsidiary of Barry Silberts Digital Currency Group, initially filed for bankruptcy on January 19th.
Genesis Global Holdco, LLC (‘GGH’) and two of its lending business subsidiaries, Genesis Global Capital, LLC (‘GGC’) and Genesis Asia Pacific Pte. Ltd. (‘GAP’), filed voluntary petitions under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York.”
The firm ran into troubles last year when crypto hedge fund Three Arrows Capital went under, causing liquidity issues. The crypto broker’s challenges were further exacerbated by the downfall of FTX.
As stated by Genesis interim CEO Derar Islim in a press release,
While we have made significant progress refining our business plans to remedy liquidity issues caused by the recent extraordinary challenges in our industry, including the default of Three Arrows Capital and the bankruptcy of FTX, an in-court restructuring presents the most effective avenue through which to preserve assets and create the best possible outcome for all Genesis stakeholders.
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This article was originally reported on The Daily Hodl.
