Cryptocurrency lEnder Genesis is reportedly preparing to declare bankruptcy as more companies deal with falling cryptocurrency prices and the collapse of FTX.
Genesis, the lending arm of Digital Currency Group, is facing a liquidity crisis and is preparing to file for bankruptcy this week. wall street journal report. A Chapter 11 filing had been anticipated for months as the company faced serious headwinds.
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Genesis website on a smartphone located in Brooklyn, New York, USA, Thursday, November 17, 2022. BlockFi Inc. and Voyager Digital Ltd.
(Gabby Jones/Bloomberg via Getty Images)
Genesis laid off 30% of its workforce in early January. The cuts were not just in his one department, but across the board. After the layoffs, the company was left with 145 of his staff. Genesis is in talks with investment bank Moelis & Company to consider options, including bankruptcy.
At the time of the layoffs, a Genesis spokesperson said the cryptocurrency lender is consulting with advisors “to protect client assets and move the business forward.”
Several other cryptocurrency companies have suffered over the past few months. FTX he imploded dramatically in November, dragging out several companies. After the cryptocurrency giant collapsed, the price of Bitcoin also plummeted.
Bitcoin has fallen from above $21,000 and has been stalling below $17,000 for weeks following the FTX drop.
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Genesis has faced heavy losses from a loan it provided to Alameda Research, a hedge fund linked to FTX, which is at the center of a dispute between the company and FTX’s disgraced founder Sam Bankman-Fried.
Crypto lender BlockFi announced that it had filed for bankruptcy late last month. BlockFi’s struggles were intertwined with his FTX struggles, and the company offered BlockFi his $400 million line of credit and the option to buy the company.
