Troubled crypto lender Genesis owes creditors at least $1.8 billion: CoinDesk

Finance firms • December 5, 2022, 3:25AM EST

Quick Take

Genesis owes its creditors at least $1.8 billion, CoinDesk reported.
That figure includes $900 million owed to customers of Gemini’s Earn program.

Troubled crypto trading and lending firm Genesis owes its creditors at least $1.8 billion, CoinDesk reported Sunday.

The Financial Times first reported on Saturday that Genesis owes customers of Gemini's Earn program $900 million. In addition to that, Genesis owes another $900 million to a group of assorted creditors, which law firm Proskauer Rose is representing, according to the CoinDesk report, which cited an anonymous source.

In addition to the Proskauer group, there is another ad hoc group of Genesis creditors being represented by law firm Kirkland & Ellis, CoinDesk reported. The amount owed to this group is unknown. Bloomberg reported last week that Proskauer Rose and Kirkland & Ellis are representing groups of Genesis creditors.

Law firm Latham & Watkins is representing the Gemini customers group, according to CoinDesk.

Genesis halted client withdrawals last month after taking large hits from FTX and earlier from Three Arrows Capital. The firm has been trying to raise funds and has hired investment bank Moelis & Company to explore its options, which include a potential bankruptcy.

U.S. state securities regulators are reportedly investigating Genesis. Alabama is said to be one of the states that is looking into whether Genesis "enticed residents to invest in crypto-related securities without making the proper registrations," according to Barron's.

About Author

Yogita Khatri is a senior reporter at The Block, covering all things crypto. As one of the earliest team members, Yogita has played a pivotal role in breaking numerous stories, exclusives and scoops. With nearly 3,000 articles under her belt, Yogita holds the records as The Block's most-published and most-read author of all time. Prior to joining The Block, Yogita worked at crypto publication CoinDesk and The Economic Times, where she wrote on personal finance. To contact her, email: [email protected]. For her latest work, follow her on X @Yogita_Khatri5.