One More, Genesis Crypto Company Potentially Bankrupt!

Genesis is facing bankruptcy. (Photo; Doc. AskCrypto)

JAKARTA – Crypto broker Genesis is reportedly facing bankruptcy. The company is currently looking for an injection of US$1 billion (equivalent to Rp. 15.7 trillion) to cover its financial problems. Previously, Genesis had stopped withdrawing funds from its crypto lending products last week.

There are fears that the crypto company's collapse could spread to its parent company Digital Currency Group (DCG). Genesis is a DCG co-ownership with crypto giant Grayscale. Recently, Grayscale has also come to the attention of the global community for not announcing the amount of their crypto fund reserves to the public.

“We have no plans to file for bankruptcy soon… Our goal is to resolve the current situation by consensus without the need for the bankruptcy filing. Genesis continues to have constructive conversations with creditors," wrote Genesis, quoted from Bloomberg.

The difficulties experienced by Genesis are the impact of the bankruptcy of FTX some time ago. As is known, the collapse of the FTX gave a domino effect on various other crypto companies. CryptoSlate reported on November 17 that the company has struggled to secure new investments since the collapse of FTX.

However, on November 17, a spokesperson from Genesis told the Wall Street Journal that the broker was having "a very positive conversation." Furthermore, Genesis CEO Michael Moro commented that "we reduced our losses with a large partner who failed to meet our margin call."

Based on the report, it is known that Genesis received 78 million FTT tokens between June and September 2022. At that time the total FTT tokens received by the company were still worth 2.3 billion US dollars (IDR 36.1 trillion). However, currently, the price of FTT has fallen due to the bankruptcy of FTX. In total, the value of FTT tokens that Genesis currently receives has decreased to US$98 million (IDR 1.5 trillion) as the price of FTT tokens has fallen from US$30 to US$1.28 per token.