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Genesis Denies Bankruptcy Rumors
Crypto Lender Reassures Customers
Amidst FTX Collapse Concerns
NEW YORK, Jan 20 (Reuters) - Cryptocurrency lender Genesis denied rumors of an imminent bankruptcy declaration, despite facing challenges in the wake of the FTX collapse.
Genesis, a unit of digital asset conglomerate Digital Currency Group, has been seeking to raise fresh capital to shore up its balance sheet. The firm's exposure to FTX, which filed for bankruptcy in November 2022, has raised concerns about its financial health.
"We are working hard to avoid a bankruptcy filing," a Genesis spokesperson said in a statement. "We are actively engaged in discussions with advisors and lenders to explore all possible options."
Genesis has not disclosed the specific amount of its exposure to FTX, but sources familiar with the matter have estimated it to be in the hundreds of millions of dollars.
Cryptocurrency markets have been roiled by the collapse of FTX, which was one of the largest crypto exchanges in the world. The firm's implosion has raised concerns about the reliability and regulation of the crypto industry.
Genesis is one of several crypto firms that have faced financial strain in the aftermath of FTX's collapse. BlockFi, another crypto lender, recently filed for bankruptcy protection.
The denial of bankruptcy rumors by Genesis provides some relief to the crypto community, but the firm's financial challenges remain a concern. The future of Genesis and other crypto lenders will depend on their ability to raise fresh capital and navigate the regulatory uncertainties facing the industry.
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