Crypto credit platform Genesis Global Capital filed on Friday (20) for creditor protection under Chapter 11 of the US Bankruptcy Law, after being hit by the FTX collapse in 2022. To start the process, it sent documents for the Court that show the size of the damage: the company owes billions of US$ 5.1 billion dollars to several creditors.
One of the affected companies is Ripio, which has US$ 27 million (R$ 140 million) to receive from Genesis. The information is in the petition presented on the credit platform. The document shows that this debt is due to a loan made by Ripio.
The consequences of this episode may affect the Brazilian market. In December 2020, Ripio acquired the Argentine broker Bitcointrade. The exchange is one of the most transacting cryptocurrencies in Brazil.
THE Bitcoin portal contacted Bitcointrade for a position on the situation, but had no response until the time of publication of this text.
Debt of BRL 3.9 billion
Genesis’ list of creditors is daunting. The company owes US$ 765 million (R$ 3.9 billion) to Gemini, a brokerage owned by the Winklevoss brothers and which has stopped withdrawals from its clients since November.
Cameron Winklevoss took to Twitter on Friday (20) to celebrate Genesis’ decision to file for bankruptcy. According to the businessman, “it is a crucial step for us to recover their [clientes] active”.
The executive stated that the bankruptcy process will allow one to find out which operations made the situation reach the point it is at. “We’re going to use every tool available in bankruptcy court to maximize client recovery,” he said.
Genesis is a company of the Digital Currency Group (DCG) conglomerate, which is now trying to save itself. The problem with Genesis was triggered by the bankruptcy of FTX and now threatens to wipe out the entire group. In search of liquidity, DCG wants to sell the Coindesk portal and a group financed by Binance has already shown interest in buying.
The creator of Gemini has been making publications against DCG for weeks, demanding responses and threatening more severe measures. The bankruptcy filing did not make him lower his tone: “”Genesis’ decision to initiate bankruptcy proceedings does not make DCG unfeasible to be held liable”.
340,000 Gemini customers were affected, according to information from Cameron himself.
5/ We have been preparing to take direct legal action against Barry, DCG, and others who share responsibility for the fraud that has caused harm to the 340,000+ Earn users and others duped by Genesis and its accomplices.
—Cameron Winklevoss (@cameron) January 20, 2023
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