The crypto industry has been heavily impacted by the FTX and Alameda crisis in recent months. Both companies have been creditors of Genesis Global over a certain time period, and the bankruptcy of FTX could result in Genesis and its subsidiary, the Digital Currency Group (DCG), having to file for bankruptcy.
According to Messari’s founder Ryan Selkis, the strong connection between Genesis and Alameda as a borrower-lender state is the main reason for Genesis’ potential downfall.
A spokesperson from Genesis revealed a statement at the end of November, claiming that the company’s goal was to come out of the current crisis without filing for bankruptcy.
However, given the current uncertain circumstances, analysts believe that Genesis is likely to file for bankruptcy.
The FTX and Alameda networks have caused a major disruption in the crypto world, affecting many firms including Genesis which had loans with Alameda as crypto borrower-lender counterparties.
Despite the large loan amounts and the current economic crisis, Genesis and DCG can both avoid bankruptcy by finding a way to decrease the amount of money owed.
Ryan believes that the liquidation of Genesis and DCG will be contingent on Grayscale GBTC Risks. Furthermore, FTX and Alameda are not creditors of Genesis and there is no connection between the two companies.
