One of the most significant cryptocurrency lenders, Genesis, has just become the latest victim of the ongoing worldwide catastrophe in the cryptocurrency market by declaring bankruptcy in the United States.
Genesis Global Capital submitted a petition for protection under Chapter 11 of the United States Bankruptcy Court late on Thursday evening in the state of New York. According to the documents submitted to the court, the creditors’ assets and liabilities are both estimated to be in the range of $1 billion to $10 billion.
In addition, the parent company Genesis Global Holdco and the loan business Genesis Asia Pacific filed for protection under the bankruptcy code.
In November, in the wake of the shocking failure of FTX, Genesis put a stop to client withdrawals and began negotiations with creditors while simultaneously attempting to acquire new funding.
According to a report published by the Financial Times earlier this month, which cited unnamed people familiar with the situation as sources of information, the owner of Genesis, Digital Currency Group, which is backed by Softbank and Alphabet, had been exploring the sale of assets to pay back more than $3 billion owed to creditors.
According to a report from the Wall Street Journal, the cryptocurrency lender fired thirty percent of its workforce earlier this month.
The collapse of Genesis is the latest blow for the cryptocurrency industry, which is still suffering from the failure of FTX and the arrest of its inventor, Sam Bankman-Fried. Genesis’s bankruptcy marks the latest blow for the cryptocurrency industry.
Bankman-Fried, who was once one of the most celebrated names in the cryptocurrency industry, is currently facing eight charges related to the collapse of his cryptocurrency empire. These charges include the allegation that he lied to investors and stole billions of dollars worth of customer funds for his own use.
Bankman-Fried has entered a not guilty plea to all of the allegations against him and maintains that he is innocent of stealing any money.