Report: Genesis Global Trading’s Lending Unit Suspends Withdrawals and New Loan Originations
Following Blockfi, Liquid Global, and Salt Lending halting withdrawals, reports indicate that Genesis Global Trading’s lending unit has halted customer withdrawals. Genesis’ interim chief executive officer Derar Islim said that the company’s trading and custody units were still operational.
DCG-Owned Genesis Halts Lending Unit’s Redemptions and New Loans
On Nov. 16, 2022, Coindesk reporter Nelson Wang detailed that Genesis Global Trading’s current CEO Derar Islim has explained that the company’s lending unit has paused withdrawals. The Digital Currency Group (DCG)-owned firm Genesis Global Trading’s CEO further detailed that the decision only affects the company’s lending side. Amanda Cowie, vice president of communications and marketing at DCG, told Wang the decision was difficult.
“Today Genesis Global Capital, Genesis’s lending business, made the difficult decision to temporarily suspend redemptions and new loan originations. This decision was made in response to the extreme market dislocation and loss of industry confidence caused by the FTX implosion,” Cowie is quoted as saying in the report. The DCG spokesperson added:
This decision impacts the lending business at Genesis and does not affect Genesis’s trading or custody businesses. Importantly, this decision has no impact on the business operations of DCG and our other wholly-owned subsidiaries.
The community has assessed that Genesis has suffered from the collapse of Terra, Three Arrows Capital, and the FTX fallout as well. The decision to temporarily suspend specific operations from the lending unit follows Blockfi, Liquid Global, and Salt Lending halting withdrawals as well since the FTX collapse.
Similarly, a number of companies fell victim to the Terra collapse and large firms like Celsius and Voyager Digital filed for bankruptcy protection when the dust cleared following UST’s depegging event and LUNA’s fall to zero.
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