Genesis Global Trading will cease operations later this month, according to one e-mail sent to customers on September 5 and confirmed in a comment to CryptoStores.
The decision to shut down the over-the-counter trading platform on September 18 was said to have been made voluntarily and for undisclosed business reasons. The remaining accounts will be closed at the end of the day on September 30.
Genesis said in an email to CryptoSlate:
Genesis has decided to stop offering spot trading of digital assets through Genesis Global Trading Inc. (GGT). Spot and derivatives trading services through GGC International Limited will continue to operate. This decision was made voluntarily and for business reasons. We are working closely with regulatory authorities to coordinate an orderly shutdown of service.
GGT managed to escape the crypto-lending-induced bankruptcy of Genesis Global earlier this year, a fate not shared by all companies linked to Genesis. GGC International Limited, another trading-focused entity, will continue to provide spot and derivatives trading services, according to the same email. Genesis is owned by Digital Currency Group (DCG).
Legal quagmire
This decision comes in the wake of the bankruptcy filing of Genesis Capital, a subsidiary of Genesis Global. The cryptocurrency lender filed an updated reorganization plan in June with the aim of resolving disputes over the initial liquidation plan filed in January. Despite reaching “substantial agreement on certain material issues” with its debtors, creditors and stakeholders, the mediation process was not yet complete.
Genesis’ bankruptcy led to a series of legal disputes. Notably, the Winklevoss twins’ cryptocurrency exchange, Gemini, has filed a lawsuit against DCG and its CEO Barry Silbert, accusing Silbert of fraudulent financial reporting to conceal Genesis’ financial instability and resulting in the loss of approximately $ 1.45 billion in frozen assets from the Gemini. Earn users of the program. Silbert and DCG refuted these allegations as “baseless, defamatory and utterly false.”
More recently, DCG agreed to provide approximately $1.4 billion in new financing to repay Genesis creditors, which would replace DCG’s existing unsecured debt.
However, Gemini rejected the proposed settlement agreement between bankrupt crypto platform FTX and Genesis, according to an Aug. 31 lawsuit. Gemini argues that the proposed settlement between the struggling companies is a manipulation of the voting process for the bankruptcy plan — an “adorable pre-plan deal” that exclusively benefits Digital Currency Group (DCG), Genesis’ parent company, at the expense of of other creditors.”
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