{"id":41405,"date":"2022-11-30T05:08:56","date_gmt":"2022-11-30T09:08:56","guid":{"rendered":"https:\/\/coinscreed.com\/staging\/?p=41405"},"modified":"2022-11-30T05:08:59","modified_gmt":"2022-11-30T09:08:59","slug":"genesis-creditors-hire-lawyers-to-prevent-bankruptcy","status":"publish","type":"post","link":"https:\/\/coinscreed.com\/staging\/genesis-creditors-hire-lawyers-to-prevent-bankruptcy\/","title":{"rendered":"Genesis Creditors Hire Lawyers to Prevent Bankruptcy"},"content":{"rendered":"\n
Bloomberg News says that Genesis is in talks with its creditors and possible investors<\/a>. <\/h5>\n\n\n\n
\"Genesis
Genesis Creditors Hire Lawyers to Prevent Bankruptcy<\/figcaption><\/figure>\n\n\n\n

People who know about the situation told Bloomberg News on Wednesday that the creditors of Genesis Global Trading have hired restructuring lawyers to help figure out a way to keep the crypto brokerage from having to file for bankruptcy.<\/p>\n\n\n\n

People say that some creditors are working with the law firm Proskauer Rose and others have hired Kirkland & Ellis.<\/p>\n\n\n\n

In the wake of FTX's collapse, the lending arm of the crypto investment bank stopped redemptions and new loans<\/a> on November 16. Interim CEO Derar Islim told customers on a call that day.<\/p>\n\n\n\n

Genesis Creditors Put Efforts to Prevent Bankruptcy<\/h2>\n\n\n\n

Bloomberg reported on November 30 that the creditors of the company are working with restructuring law firms<\/a> to find ways to keep the crypto brokerage from going bankrupt.<\/p>\n\n\n\n

Some creditors work with the law firm Proskauer Rose, and others work with Kirkland & Ellis. The company also hired the investment bank Moelis & Company to look at its options, which could include filing for bankruptcy. But the goal is to solve the problem without having to file for bankruptcy right away. Genesis and DCG are also looking for emergency funding<\/a> of $500 million.<\/p>\n\n\n\n

Genesis interim CEO Derar Islim said:<\/p>\n\n\n\n

\n

We\u2019ve begun discussions with potential investors and our largest creditors and borrowers, including Gemini and DCG, to agree on a solution that shores up our lending business\u2019 overall liquidity and addresses clients\u2019 needs<\/p>\n<\/blockquote>\n\n\n\n

After FTX<\/a> went down, Genesis Capital, the crypto lending arm of Genesis Trading, stopped letting customers get their money back and stopped giving out new loans. Genesis has about $175 million in funds that are locked up in FTX. In fact, Genesis's parent company, Digital Currency Group, owes Genesis Capital $575 million.<\/p>\n\n\n\n

BlockFi Bankruptcy Reveals Internal Transactions<\/h2>\n\n\n\n

BlockFi's bankruptcy and the lawsuit against SBF's personal holding company, Emergent, showed that FTX, Alameda Research, and BlockFi did business with each other. Both FTX and Alameda went out of business because they borrowed money from each other. Also, FTX used money from cryptocurrency lenders BlockFi and Voyager to bail them out.<\/p>\n\n\n\n

Sam Bankman-Fried also used Alameda Research accounts to get into regulated banks, which were reluctant to work with crypto companies like FTX. Customers were told to use bank accounts in Alameda to send money by wire to FTX.<\/p>\n\n\n\n

In a similar way, DCG, Genesis Trading, and other related companies are said to use internal borrowing and lending to run their businesses, which increases their risks of running out of money and going bankrupt.<\/p>\n\n\n\n

Digital Currency Group, which is the parent company of both Genesis and CoinDesk, also owns CoinDesk.<\/p>\n","protected":false},"excerpt":{"rendered":"

Bloomberg News says that Genesis is in talks with its creditors and possible investors. People who know about the situation told Bloomberg News on Wednesday that the creditors of Genesis Global Trading have hired restructuring lawyers to help figure out a way to keep the crypto brokerage from having to file for bankruptcy. People say […]<\/p>\n","protected":false},"author":39,"featured_media":41407,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[10893,1553,12246],"class_list":["post-41405","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-bankruptcy","tag-blockfi","tag-genesis-global"],"jetpack_featured_media_url":"https:\/\/coinscreed.com\/staging\/wp-content\/uploads\/2022\/11\/image-145.png","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/41405","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/users\/39"}],"replies":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/comments?post=41405"}],"version-history":[{"count":0,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/41405\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media\/41407"}],"wp:attachment":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media?parent=41405"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/categories?post=41405"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/tags?post=41405"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}