Genesis Trading reveals $175M of funds are locked in FTX

In what it hails as an effort to be transparent, Digital Currency Group’s market maker and lending subsidiary, Genesis Trading, revealed that its derivatives business has around $175 million worth of funds locked away in an FTX trading account.

Genesis shared the news in a Nov. 10 tweet thread, in which the firm clarified that the locked funds would “not impact our market-making activities.”

Genesis also stated that they have no ongoing relationship with FTX or its sister company Alameda Research, the latter of which FTX CEO Sam Bankman-Fried has said is “also winding down trading.”

The denouncement of an ongoing relationship follows on from other businesses within the crypto industry seeking to distance themselves from the FTX fallout, with Tether, Circle, Kraken and Coinbase all having declared that they are not exposed to either of the troubled firms.

https://www.youtube.com/embed/7-FTQ-fqRSQ

While Genesis suggested in the Nov. 10 thread that its capital and positions in FTX would not prevent the “full functioning of our trading franchise,” it remains to be seen whether its parent company Digital Currency Group will be required to step in like it did after Genesis suffered from its exposure to Three Arrows Capital (3AC).

Related: Galaxy Digital discloses $77M exposure to FTX, $48M likely locked in withdrawals

Genesis claimed that it has “printed record volumes,” amid the FTX fallout, after claiming on Nov. 9 that investors turn to them when market conditions are volatile to manage their risks.

However, Its active loans had fallen 74.8% throughout the latest crypto winter, with its latest Q3 report showing that active loans outstanding totalled $2.8 billion compared to $11.1 billion at the same time last year.

Source: Read Full Article