The rush for funding was precipitated by a liquidity crunch at the lender after the sudden collapse of FTX, one of the world’s largest crypto exchanges. Genesis halted redemptions shortly after revealing on Nov 10 that it had US$175 million locked in an FTX trading account.
Digital asset brokerage Genesis is struggling to raise fresh cash for its lending unit, and it’s warning potential investors that it may need to file for bankruptcy if its efforts fail, according to people with knowledge of the matter.
Genesis has spent the past several days seeking at least US$1 billion ($1.38 billion) in fresh capital, said the people, who asked not to be identified because discussions are private. That included talks over a potential investment from crypto exchange Binance, they said, but funding so far has failed to materialize.
