Genesis Global Trading suspends credit extension after 'biggest deleveraging' it has seen in the crypto market

Quick Take

  • According to Genesis CEO Michael Moro, last month’s market meltdown left crypto futures trading at a discount, with the firm witnessing the biggest deleveraging it has seen to date
  • While its rivals continue to give out loans at lower collateral rates, Genesis decided to suspend credit extension for at least a few weeks.

Genesis Global Trading – the institutional over-the-counter cryptocurrency trading and lending firm – has suspended credit extension after observing the "biggest de-leveraging" it has ever seen.

In the latest episode of The Scoop, Genesis CEO Michael Moro claimed that the cryptocurrency credit market is experiencing an unprecedented level of instability due to disappearing arbitrage opportunities following last month's volatile price swings.

At the beginning of the year, he said, the bitcoin futures market was trading at a premium to the spot market. As a result, Genesis counterparties would typically borrow U.S. dollars, purchase crypto assets in the spot market, and then sell them in the futures market to capture the arbitrage opportunity. 

"March 12th and 13th happened and that market flipped," according to Moro.

Due to bitcoin's dramatic price d