Following the recent crash of cryptocurrency exchange FTX, the spotlight has now turned to crypto trading and lending platform Genesis. Recent reports show that the platform’s creditor group loans are now well over $1 billion based on recent findings by one of the plaintiffs’ legal counsels.
Previously, it was reported that Genesis owned a number of customers using the Earn program on the Winklevoss Twins’ cryptocurrency exchange Gemini for $900 million. This was after Genesis’ lending unit stopped customer withdrawals last month. The Gemini users group is represented by the legal firm Latham and Watkins.
As of press time, the Proskauer Rose team, representing another group of plaintiffs, conducted its own investigation into the issue.
Recent Findings are Alarming
Based on the Proskauer investigation, it was noted that several groups are claiming that Genesis owes them money. The law firm noted that the current tally is now at $1.8 billion, and the total is expected to go higher thanks to a third ad-hoc group.
This third group is currently being represented by Kirkland and Ellis, which previously represented fallen cryptocurrency firms Celsius and Voyager Digital. The amount of money owed to this third group has not been disclosed at this time.
A Time for Discussions
As of November 23rd, Genesis issued a letter to its core investors stating that it was in the process of discussing the issue with its largest creditors and borrowers, including its parent company, the Digital Currency Group (DCG), as well as Gemini and a group of potential investors.
The involved parties are set to discuss potential solutions that could improve the overall liquidity of Genesis’ lending business, as well as other possible client needs.
Presently, Genesis has yet to make a formal statement regarding the issue. Likewise, all three of the legal teams have not made comments to the media regarding any motions that have been filed at present.
