This article comes fromDecrypt, original author: Zi Wang

Odaily Translator |

Odaily Translator |According to the Wall Street Journal

"Reported that Genesis, an encryption trading and lending agency, had sought an emergency loan of US$1 billion from investors to avoid the "liquidity crunch" caused by the collapse of the encryption exchange FTX.

According to a Genesis document obtained by The Wall Street Journal, Genesis needed to secure a loan by 10:00 a.m. ET on Monday (November 14), but it was ultimately unsuccessful.

On Wednesday (November 16), Genesis Global Trading announced that its lending arm, Genesis Global Capital, will suspend redemptions and new loan issuances, saying that the collapse of FTX has caused unprecedented market turmoil, resulting in abnormal withdrawal requests exceeding Genesis' current liquidity.

“The persistent run on deposits was primarily driven by retail programs, Genesis’ partners (i.e. Gemini Earn), and institutional clients testing liquidity,” the filing said.

A Genesis spokesperson told Decrypt on Friday that Genesis “has been exploring all possible options amidst the liquidity crunch caused by the FTX-related news. After considering several options, we have made the difficult decision to suspend Redemptions and new loan originations in the lending business so that we can find the best solution and possible outcome for our clients.”

Genesis tweeted on Wednesday that its trading and custody operations remained "business as usual." Broker-dealer Genesis Global Trading, which is registered with the SEC and holds a virtual currency license from Genesis, is fully independent in terms of funds and operations and is not affected by this decision.Genesis said on Nov. 11 that

, whose derivatives business has $175 million locked up in its FTX account, although it said it would not affect its market-making activities. Then Genesis stated that it received a $140 million equity injection from its parent company Digital Currency Group (DCG), which will be used to optimize Genesis' balance sheet and strengthen its position in the encryption market.

Genesis Global Trading interim CEO Derar Islim said on a conference call Wednesday that Genesis is looking for solutions for the lending unit, including finding new sources of liquidity. Genesis intends to detail its plans to customers next week.

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Genesis Becomes the Latest Victim of FTX Bankruptcy Fallout

Genesis joins the growing list of crypto firms affected by FTX's bankruptcy earlier this month.

FTX, founded by Sam Bankman-Fried, and various affiliates filed for Chapter 11 bankruptcy protection last week. According to reports, the number of its creditors reached more than 1 million.Crypto exchange Liquid Global and crypto lending firm SALT have both suspended withdrawals this week. In addition, sources revealed thatCrypto lending firm BlockFi is considering filing for bankruptcy protection