The leading institutional trading firm Genesis Global owned by Digital Currency Group (DCG) needed a $1 billion emergency loan as cited in a confidential fundraising document.
As per a WSJ report, Genesis needed access to the loan by 10 a.m. Monday because of a “liquidity crunch due to certain illiquid assets on its balance sheet.”
Genesis didn’t get the required loan money and a spokeswoman for Genesis also said the fundraising document was prepared over the weekend and doesn’t exist anymore.
Also Read: Genesis’ Crypto-Lending Arm Suspends Withdrawals Following FTX Crash
The document stated, “There is ongoing run on deposits driven mainly by retail programs and partners of Genesis (i.e., Gemini Earn) and institutional clients testing liquidity.”
According to the spokeswoman, after considering several possibilities, the team made the decision to temporarily cease withdrawals and new loan originations in the lending department in order to discover the optimal solution and outcome for clients.
Genesis announced that the Genesis derivatives business currently has around $175M in locked funds in the FTX trading account and has hired advisors to explore all possible options.
