Genesis Brokers Owes $900 Million to Gemini
The FTX collapse has left Genesis brokers in heavy debt, another example of the spreading contagion from the exchange collapse. According to a report by newspaper the Financial Times, the crypto broker and the Digital Currency Group (DCG) owe around $900 million to the Winklevoss twins’ exchange, Gemini.
DCG is a venture capital company that owns Grayscale asset manager and Genesis brokerage. Last month, its founder, Barry Silbert, addressed the company's shareholders about market turmoil in a letter. It shared that the company owes more than $575 million to the brokerage's lending arm.
The borrowed amount was to be used for new investment opportunities and was due in May 2023. The loan was taken when DCG assumed control of Genesis Trading after the default of Three Arrows Capital (3AC).
Gemini seeking to recover its customers’ funds
Genesis brokers and Gemini crypto exchange worked together for a digital asset lending program called Earn. The debts affected its operations, and it halted withdrawals from customers’ accounts. Now, Gemini has set up a creditors committee that will make efforts to retrieve the funds from DCG and its subsidiary, crypto lender.
Currently, a creditor group is in talks with the company about $1.8 billion worth of loans. Another creditor group, accounting for $900 million, is taking advice from the law firm Proskauer Rose.
Genesis brokers may file for bankruptcy
Genesis Global Capital is likely to file for bankruptcy. However, the firm has acquired the services of investment bank Moelis to explore its options. On 16 November, the firm suspended withdrawals from customer accounts. The initiative was taken after the sudden decline of the Sam Bankman-Fried exchange, FTX.
The suspension also triggered an unexpected outage for the Gemini exchange. The overall operations of the crypto exchange are being affected due to the spread of FTX contagion.

Author: Wasay Ali
Wasay Ali is a versatile professional writer with global experience and a background in mechanical engineering and social science. He is adept at crafting news and informational content for the crypto space and has experience writing for other niches. He is a professional SEO content writer who has worked with several digital marketing agencies and clients in the US, UK, Pakistan, and Europe. He is a dedicated volunteer and enjoys reading, writing, poetry, and going to the gym. He is an INFJ-A personality type dedicated to positively impacting the world. Wasay has a passion for writing as it allows him to express his creativity, share his knowledge, and connect with people worldwide.
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