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Genesis crypto lending arm suspends customer withdrawals after FTX meltdown
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Crypto broker Genesis Global Trading has announced Wednesday that it has made the "difficult decision to temporarily suspend redemptions and new loan originations" following the collapse of crypto market FTX, which it says has created "unprecedented market turmoil."
The move comes as the U.S. and the Bahamas reportedly are discussing potentially extraditing former crypto billionaire Sam Bankman-Fried to the U.S. for questioning regarding the collapse of his company. FTX was the third-largest crypto market in the world at the start of last week when it announced liquidity problems and said it would need a massive infusion of cash to stay afloat.
"The default of [crypto hedge fund Three Arrows Capital] negatively impacted the liquidity and duration profiles of our lending entity Genesis Global Capital. Since then, we have been de-risking the book and shoring up our liquidity profile and the quality of our collateral," the company wrote on Twitter.
"However, FTX has created unprecedented market turmoil, resulting in abnormal withdrawal requests which have exceeded our current liquidity," it continued.
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