The lending company claims to be having “constructive conversations with creditors” and hopes to resolve the situation without filing for bankruptcy.
Genesis cryptocurrency lending company has denied rumors that it is planning an “imminent” bankruptcy filing if it fails to cover a $1 billion shortfall caused by the collapse of crypto exchange FTX.
According to Bloomberg report, the firm has reportedly had difficulty raising funds for its lending unit and has informed investors that it will have to file for bankruptcy.
A Genesis spokesperson told Cointelegraph that the company had no plans to file for bankruptcy “immediately” and that it was still in “constructive” talks with creditors.
“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.”
Genesis announced on November 16 that withdrawals had been temporarily halted due to “unprecedented market turmoil” following FTX’s demise.
On November 10, the company revealed that it had approximately $175 million in funds in an FTX trading account.
According to reports, cryptocurrency exchange Binance was in talks to potentially bail out the Digital Currency Group-owned lender, but sources quoted in Wall Street Journal report claimed Binance had walked away from the deal because the business could create a conflict of interest.