The fallout from the $32 billion collapse of Sam Bankman-Fried’s FTX crypto exchange and his associated company Alameda Research is continuing to spread as more firms report their exposure to his Ponzi scheme operation.
Last week, the Wall Street Journal (WSJ) reported what it called the “massive crypto lender” Genesis Global Trading had laid off 30 percent of its staff and was in discussions about filing for chapter 11 bankruptcy.
Genesis had been previously hit by the failure of the crypto-based hedge fund Three Arrows Capital after providing it with a $2.4 billion loan.
Its financial problems deepened with the implosion of FTX because it had lent hundreds of millions of dollars to Alameda.
Last November, Genesis halted redemptions, hitting the crypto exchange Gemini which had $900 million of its customers’ funds tied up in the firm. Other firms may also be affected.
According to the WSJ article, Genesis is owned by the crypto conglomerate Digital Currency Group, which operates several other crypto-based firms, including the crypto news outlet Coinbase.
The FTX collapse also sparked a run on a major crypto bank, Silvergate, whose business involved the movement of money from institutional investors in and out of the crypto markets.
Last Thursday it announced that deposits from its customers had fallen from $12 billion to just $4 billion in the fourth…
