HomeNewsGenesis Faces Nine-figure Losses

Genesis Faces Nine-figure Losses

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  • According to reports, Genesis, the DCG-owned trading behemoth, lost hundreds of millions of dollars because of connections to Three Arrows Capital (3AC) and Babel Finance.

Genesis’ connections with Three Arrows Capital

According to those with knowledge of the situation, crypto market builder and loan business Genesis Trading potentially suffered losses in the “hundreds of millions.”

The losses are in the range of a few hundred million dollars and are related partly to connections to the high leverage hedge fund Three Arrows Capital and the Hong Kong-based cryptocurrency lender Babel Finance.

The pressure comes as Three Arrows Capital’s failure spreads shockwaves through the cryptocurrency lending sector. Multiple businesses are suffering significant damage as a result of their involvement in the hedge fund.

Following the high-profile collapse of crypto firms like Terraform Labs, Celsius, and Three Arrows Capital, which was assisted by a collapse in the worth of virtual currencies overall. There have been a number of liquidations at countless distinctive bank loans and trading systems for digital currencies. Particularly Three Arrows Capital has had a significant influence on Genesis. Voyager, a cryptocurrency brokerage, witnessed a decline in its price and was obliged to restrict transactions after declaring the investment firm 3AC defaulted on debts totaling approximately $670 million.

Genesis suffering huge losses, Credit: Forbes
Genesis suffering huge losses, Credit: Forbes

What do we know about the current status?

Since Genesis is pursuing at least limited recovery from its partners and some of the damages might be mitigated by hedging, the actual amount of its liabilities may not become public for a certain time. Genesis has been removing available credit from partners left and right amidst this unpredictability.

In the first half of 2022, Genesis issued contracts worth more than $44.3 billion. Genesis will probably receive assistance from its parent business Digital Currency Group (DCG), a sizable crypto multinational firm. DCG is thought to have a defense fund of around $1 billion.

Ujan Chakraborty
Ujan Chakraborty
Nothing but Blue Skies.

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