From Genesis to BlockFi and even Celsius, some crypto lending platforms have been in bad shape since the giant FTX went bankrupt.
The FTX bankruptcy continues to take its toll. Genesis Global Capital, Genesis’ cryptocurrency lending platform, announced on Wednesday that it was “temporarily” suspending redemptions and new loans to its clients. For its part, Genesis Trading admitted to having $175 million locked up on FTX.
A few months ago, the lending platform’s activity was hit hard by the collapse of Three Arrows Capital (3AC), due to its exposure to the Singaporean investment firm.
“Next week we will present a plan for the lending activity. We are working tirelessly to find the best solutions for the lending activity, including, among other things, the search for new liquidity”, the company clarifies.
From Genesis to Gemini
Following this announcement, giant Gemini, which had Genesis Global Capital as its main lending partner, indicated that its ‘earn’ program “will not be able to accommodate redemptions from its customers” for 5 days.
“This situation has no impact on other Gemini products and services (…). All customer funds held on the Gemini exchange are retained and can be withdrawn at any time”, Gemini clarifies.
Gemini is an American exchange specialized in the trading and storage of cryptocurrencies, launched by the Winklevoss twin brothers in 2014.
BlockFi is preparing to go bankrupt
For its part, the lending platform BlockFi, which had been “rescued” during the summer by FTX, is also preparing to go bankrupt, reports The Wall Street Journal. BlockFi was founded in 2017 and claims 650,000 customers. After FTX went bankrupt, BlockFi, which has “significant exposure” to FTX, suspended withdrawal requests from its users.
Similarly, lending platform Celsius, which went bankrupt in July, revealed that it had $12 million exposed to FTX in the form of loans to Alameda Research. Disclosures that may further complicate the refund procedure for its customers. Celsius claimed 1.7 million users before its bankruptcy.