Source: Julia Tsokur – Shutterstock
Gemini announced that it has been working alongside DCG to enable its users to redeem their funds after halting withdrawals due to the FTX crisis.Genesis is exploring several ways to raise funds and protect itself against insolvency.
The FTX collapse has sent a chilling message to the crypto industry, and no investor is safe from the uncertainty of market dynamics. With a record number of losses from crypto exchanges, several crypto users have begun to lose faith in ever getting their initial capital back, but Gemini appears to be an exception.
In a post on its official Twitter account earlier this week, Gemini announced that it is working with Genesis Global Capital to enable its Earn customers to redeem their funds. In addition, Genesis’s parent company, Digital Currency Group (DCG), is also working on finding solutions to the issue. Genesis Global Capital is the lending partner of Gemini’s Earn product.
According to Gemini, getting Earn users to redeem their funds remains its priority. However, Genesis and DCG are equally committed to exploring all avenues to fulfill their pledge to the customers.
Furthermore, the firm took the opportunity to commend the product users and their cooperation amid the challenging times the market is currently experiencing. It also assured them that Gemini would continue to update them on the progress of its next course of action. However, the repayment plan does not involve other products of Gemini because the company is a fully registered reserve exchange and fund custodian.
The FTX contagion hit Gemini, and like other firms. But Gemini is taking several steps to minimize the impact of the crisis on its business operations. With this, the company noted that each customer’s fund in its exchange and custody is readily available for withdrawal on requests.
Genesis Explore Fresh Funding to Beef up Liquidity
Genesis Global Capital revealed that it had engaged the services of investment giant, Moelis & Co. a few days after suspending withdrawals. Genesis hopes to use this service to bolster its crypto-lending liquidity and meet customers’ needs. In a memo to clients, the firm’s interim CEO, Derar Islim, explained that it has started discussing with potential investors alongside their creditors and borrowers, Gemini and DCG.
The CEO noted that Moelis’ services are needed to help Genesis expand and fast-track the discussions in the coming days. For most days this month, Genesis has been running from pillar to post, seeking more funding as it tried to strike a deal with its creditors following its exposure to the now-collapsed FTX. Last week, its institutional lending department was forced to halt redemption and new loan processing.
Moreover, the crypto lender has previously revealed that it had about $175 million as locked derivative funds on the FTX trading platform. However, DCG boosted Genesis’s balance sheet by injecting additional equity funds worth $140 million. On Tuesday, November 22, DCG’s founder disclosed that the firm has close to $575 million in liabilities to Genesis Global, with May 2023 as the expected repayment date.