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Genesis Requests a $1 Billion Emergency Loan- WSJ

Genesis Holds Liabilities Totaling Over $5 Billion

The Wall Street Journal reported Thursday, citing a private fundraising letter, that crypto lender Genesis was asking for an emergency loan of $1 billion from financiers before it blocked withdrawals on its website.

The paper seen by the Journal mentions “liquidity crisis owing to some illiquid assets on its balance sheet” at Genesis. Following the unexpected closure of Sam Bankman-cryptocurrency Fried’s exchange FTX on Wednesday, Genesis Global Capital stopped client withdrawals in its lending company.

Genesis stated in an email to Reuters that it had been exploring all conceivable possibilities amid a liquidity shortage caused by the FTX announcement before deciding to temporarily halt redemptions.

The collapse of FTX has sent shockwaves across the business world, reducing liquidity at companies that had exposure to what was once the largest cryptocurrency exchange in the world and sparking inquiries from authorities in a number of jurisdictions.

After rival exchange Binance backed out of a potential merger last week, FTX founder Sam Bankman-Fried quit as CEO, and the company filed for U.S. bankruptcy protection the following day.

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