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Genesis, a Crypto Lending Firm, Files for Bankruptcy

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Cryptocurrency lender Genesis Global Holdco filed for bankruptcy late Thursday. Sam Bankman-Fried.

A year ago, Genesis and a group of other large lenders lured millions of customers with the promise that they would be able to deposit their cryptocurrency holdings and earn very high returns. However, Genesis’ bankruptcy filing makes him the fourth major cryptocurrency lender to fail since the digital asset market faltered last spring. send price plungeOther major lenders that have gone out of business include: Celsius network Voyager Digital where customers lost billions of dollars in deposits.

Genesis survived longer, but was affected by FTX’s implosion. Genesis announced in November that it was freezing withdrawals. ‘Market turmoil’ Bankman-Fried’s business went bankrupt.

The filing in the Southern District of New York bankruptcy court covered three entities: Genesis Global Holdco and its subsidiaries Genesis Global Capital and Genesis Asia Pacific.

Genesis is a subsidiary of Digital Currency Group, a cryptocurrency conglomerate founded by Barry Silbert in 2015. Silbert’s management and issues with his Genesis recently put him at odds with two of his other prominent crypto execs, Cameron and Tyler Winklevoss. Exchange Gemini.

Last week, the Securities and Exchange Commission Paid Genesis offering unregistered securities in partnership with Gemini. Gary GenslerChairman of the SEC.

winklevoss is He publicly denounced DCG, the parent company of Genesis. of a stall to hold funds belonging to a customer. They also alleged that DCG and Genesis misrepresented financial information and mischaracterized the value of corporate assets, giving the impression that Genesis was healthier than it had been.

The SEC indictments against Genesis and Gemini were part of a broader crackdown on cryptocurrency lenders. In February, the agency announced it would fine cryptocurrency lender BlockFi $100 million. BlockFi filed for bankruptcy in November, making him one of the first big victims of the FTX collapse.

Early Thursday, the SEC announced $45 million settlement Colluding with another cryptocurrency lending firm, Nexo, for violating securities laws.

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