Crypto lending platform Genesis is currently struggling and could be in need of investors to enable it to maintain its operations.
Cryptocurrency exchange Binance will not invest in Genesis, according to a recent report by the Wall Street Journal.
The report revealed that the cryptocurrency lending platform sought investment from Binance, the world’s leading cryptocurrency exchange. However, Binance turned down the opportunity to invest in the company owned by the Digital Currency Group.
The WSJ report added that Binance turned down the opportunity over a potential conflict of interest with Genesis’ business model. Furthermore, Genesis also sought investment from Apollo Global Management. However, it remains unclear if Genesis will receive the funds it needed from the asset management firm.
This latest cryptocurrency news comes roughly a week after Genesis suspended redemptions and new loan origination on its platform.
Today Genesis Global Capital, @GenesisTrading‘s lending business, made the difficult decision to temporarily suspend redemptions and new loan originations.
— Digital Currency Group (@DCGco) November 16, 2022
At the time, Genesis said;
“This decision was made in response to the extreme market dislocation and loss of industry confidence caused by the FTX implosion. The impact lies with the lending business at Genesis and does not affect Genesis’s trading or custody businesses. Importantly, this temporary action has no impact on the business operations of DCG and our other wholly owned subsidiaries.”
Genesis assured its users that it would continue to offer over-the-counter trading for spot and derivatives trading in addition to its custody services.
Despite Binance turning down a chance to invest in Genesis, a company spokesperson told The Block that Genesis doesn’t plan to file for bankruptcy soon. The spokesperson said;
“We have no plans to file bankruptcy imminently. Our goal is to resolve the current situation consensually without the need for any bankruptcy filing. Genesis continues to have constructive conversations with creditors.”
Genesis’s announcement to suspend redemptions affected Gemini, another leading crypto exchange. At the time, Gemini said its Earn program would not be able to meet customer redemptions within the service-level agreement of five business days.