According to a recent report from the Financial Times (FT), Genesis Global Capital allegedly owes $900 million to Gemini clients. The exchange run by Cameron and Tyler Winklevoss is trying to recover funds from Genesis, according to FT sources.
Report Claims Genesis Owns $900 Million Winklevoss-operated Gemini Exchange
FT report that the centralized crypto-asset exchange created by the Winklevoss brothers is owed $900 million and Genesis Global Capital is said to be in debt. People familiar with the matter told the FT that Gemini is in the process of trying to recover funds from Genesis and its parent company Digital Currency Group (DCG).
The report also alleges that Genesis is still trying to raise capital from investors to ease the financial burden. While reports noted that Genesis was trying to get $1 billion in funding, the FT detailed that it had been cut down to about $500 million. The news follows a report published by Barron’s author, Joe Light, noting that Genesis is report are being probed by state securities regulators.
Furthermore, on November 22, 2022, the New York Times (NYT) report that Genesis Global Capital has hired a restructuring advisor. The NYT detailed that Moelis & Company was hired by Genesis to “explore options including the possibility of bankruptcy,” according to three people familiar with the matter. The FT’s report on issues between Genesis and Gemini indicates that FT sources say Gemini is in the process of forming a creditor committee.
Last month, Gemini revealed that customers using the platform’s Monetization program were unable to withdraw funds. “We are working with the Genesis team to help customers exchange money from the Earn Money program as quickly as possible,” Gemini speak on November 16, 2022. Gemini emphasizes that customer funds on Gemini can be redeemed 1:1 at any time and that the exchange’s other products and services are normal.
Gemini’s message published on the same day as Genesis Global Capital detail that it is suspending withdrawals and initiating new loans. DCG Founder Barry Silbert detailed in a letter to shareholders 22, it is important to note that Genesis’ lending arm “has had no impact on Genesis’s custody or spot trading and derivatives business, which will continue to operate as usual. .” Silbert also reassured shareholders that his company will “continue to be the leading construction company in the industry”.
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