Gemini crypto exchange has stated that it is working with Genesis and Digital Currency Group to find a solution for its Earn users unable to redeem their funds.
The Winklevosses-led crypto exchange Gemini has stated that it is continuously working with its lending partner, Genesis Global Capital and its parent company Digital Currency Group (DCG), towards finding a solution for its Earn users who are unable to withdraw their funds.
Genesis and DCG Remain Committed to Fulfilling Their Obligations
The Gemini team added that a resumption of withdrawals remains their highest priority and that both Genesis and DCG ‘remain committed to exploring every possible option to fulfil their obligations to Earn users.’
In addition, the team at Gemini thanked their Earn users for their patience during this ‘challenging time’. The exchange promised to provide updates as soon as they were available. Gemini exchange also reiterated that ‘all customer funds held on the Gemini Exchange and in Gemini Custody are held 1-to-1 and available for withdrawal at any time.’
Genesis Reportedly asks Binance and Apollo for Cash
As mentioned earlier, Genesis is Gemini’s main lending partner for its Earn program.
However, last week, Genesis announced that it was halting withdrawals and new loans due to a massive increment of withdrawal requests in the aftermath of FTX’s collapse. The withdrawals had exceeded its liquidity at the time.
Genesis and the team at DCG have since been looking for a capital injection by raising cash. According to the Wall Street Journal (WSJ), Genesis has so far approached Binance for investment and to bid for its loan book. But the crypto exchange has reportedly decided not to go through with the deal in fear that Genesis’ business could create a conflict of interest down the line.
The WSJ also reported that the lending company has also approached Appollo Global Management for capital assistance.
Genesis Has ‘No Plans to File for Bankruptcy’
Concerning whether Genesis will opt for the bankruptcy route if funding cannot be found, a company spokesperson told the WSJ that there were no such plans.
They said, ‘We have no plans to file bankruptcy imminently. Our goal is to resolve the current situation consensually without the need for any bankruptcy filing. Genesis continues to have constructive conversations with creditors.’
(by John P. Njui)