Genesis could finally file for bankruptcy after its attempts to raise fresh money failed.
Genesis Global Capital is preparing to finally file for bankruptcy after the collapse of FTX ripped a hole in the company’s finances, according to people familiar with the matter.
Bankruptcy could be filed this week.
According to a Bloomberg report on Wednesday, bankruptcy talks are still ongoing and plans could change.
Shortly after the FTX collapse, Genesis indicated that it might have to file for bankruptcy if it did not receive fresh funding. Its derivatives business lost $175 million on the defunct stock, after which the company froze withdrawals.
Since then, Genesis has been unable to find a solution that would allow it to resume withdrawals. This has left users of the Winklevoss-owned Gemini Earn without access to their assets, as the service remortgaged user funds to Genesis.
Cameron Winklevoss has since accused Genesis, Digital Currency Group (DCG; Genesis parent), and DCG CEO Barry Silbert of misrepresenting Gemini’s financial health through misleading financial statements. As a consequence, he called for the immediate removal of Barry Silbert as CEO.
Earlier this week, DCG announced that it would stop paying quarterly dividends to its creditors to save cash.
The company is studying a full or partial sale of CoinDesk, its cryptocurrency company, with advisers from the Lazard Group, according to the Wall Street Journal.
