Genesis Crypto is a digital money service provider, helping their clients with spot trading and derivatives trading as well as offering custody services for larger clients to store their digital money safely with them.
Genesis stopped allowing customers to withdraw their funds in November 2022 due to financial strain, as they owed many people money and needed money back quickly.
What is Genesis Crypto?
The Genesis Block is the initial verified data block that kickstarts any blockchain. Miners rely on it as they know when and why the chain was formed. Without its existence, transaction verification would become much harder to accomplish.
Since then, additional blocks have been added to the chain, each containing transaction data related to previous blocks – one reason why blockchains are so secure.
Genesis hasn’t had it easy with rules and money issues either, though their other operations still face issues that affect them significantly. They had to stop allowing customers from another company called Gemini to withdraw assets due to problems with funds as well as concerns from New York Attorney General action – an action which sent shockwaves through the cryptocurrency world.
Money Problems and Bankruptcy
Although some may have expected to quickly get rich by investing in cryptocurrency, they could lose all their wealth if companies such as Genesis go bankrupt. Genesis is currently going through bankruptcy proceedings that could see only 61% of what was originally due returned back to people who invested on its platform.
Creditors have expressed strong displeasure with this plan and some have threatened legal action against the company. If unable to reach an amicable resolution with its creditors and corporate parent Digital Currency Group, then the business may need to liquidate assets and close.
Genesis and Gemini Trust Co, founded by identical twins Cameron and Tyler Winklevoss, are embroiled in a high-profile legal dispute, as the bankruptcy filing has further complicated matters between them. Genesis and Gemini Trust Co collaborated on an Earn program offering investors the ability to deposit their cryptocurrency with an exchange in return for interest; its failure triggered litigation between both companies which resulted in SEC filings against both firms.
Deal Between Genesis and Gemini
After the market crash, Genesis stopped allowing people to withdraw funds from its Earn program, prompting a series of lawsuits from customers and drawing scrutiny from regulators such as SEC. This demonstrated how untrustworthy crypto lending programs really are.
Genesis recently filed an updated proposed Plan of Reorganization and Disclosure Statement, maintaining their commitment to confirm a plan by summer’s end. Gemini continues work on provisions in their Plan to help Earn users recover assets more easily.
Gemini remains frustrated with Genesis, Digital Currency Group (DCG), and Barry Silbert for their refusal to honor their contractual obligation and deliver the second tranche of Earn users’ collateral. As part of a legal action filed last month against DCG to recover over $1 billion, Gemini is filing an arbitration demand seeking over $27 million from DCG as compensation.
Stopping Trading Services
Genesis Crypto is an industry giant in digital money. Working closely with big investors and developing innovative trading techniques for them to understand and trade on the market, they also abide by all regulations while working alongside other companies to make cryptocurrency more trustworthy.
The company announced their intentions to cease trading cryptocurrency spot and derivative markets over-the-counter; however, their regulated exchanges and custodial services will remain active, while any open derivative positions will be honored until their expiration dates.
Genesis Global Trading, another trading-focused division involved with FTX’s misdeeds, decided this month to voluntarily cease spot trading due to “business reasons.” GGC International Limited however will still provide services.
