In a shocking turn of events, the lending unit of crypto firm Genesis has filed for bankruptcy protection in the United States. This move comes on the heels of the recent market downturn that has affected other major players in the crypto industry, such as FTX.
According to the bankruptcy filings, Genesis’ lending unit reported having between $1 billion and $10 billion in assets and liabilities. The company, which was one of the largest crypto lenders in the industry, froze customer redemptions on November 16th, following FTX’s declaration of bankruptcy.
The news of Genesis’ bankruptcy has also sparked legal action from Gemini, a crypto exchange co-founded by Cameron Winklevoss. Winklevoss has accused Genesis’ parent company, Digital Currency Group (DCG), and its CEO, Barry Silbert, of defrauding Gemini. In a statement, Winklevoss said that the bankruptcy was “a crucial step towards” recovering assets for Gemini Earn users.
1/ Earn Update: This evening, Genesis Global Capital, LLC (Genesis) filed for bankruptcy under Chapter 11. This is a crucial step towards us being able to recover your assets.— Cameron Winklevoss (@cameron) January 20, 2023
The bankruptcy of Genesis highlights the volatility of the crypto industry and the need for increased transparency and accountability to protect investors. It serves as a reminder that investing in digital assets comes with a high level of risk and caution should be exercised. The legal actions against Barry Silbert and DCG also bring attention to the need for fair treatment of creditors in case of such situations in the future.
For more updates, stay tuned to CoinTopper.com