20 January

“Genesis Global Holdco LLC, the parent company of troubled cryptocurrency lender Genesis Global Capital, filed for Chapter 11 bankruptcy protection after being pummeled by two of 2022’s biggest industry collapses. In its filing, Genesis Global Capital, the partner firm to Gemini’s defunct Earn program, estimated more than 100,000 creditors and between $1 billion and $10 billion in liabilities, as well as assets.

Genesis’ other subsidiaries involved in the derivatives and spot trading and custody businesses as well as Genesis Global Trading were not included in the filing and continue client trading operations, according to a press release. In its filing, Genesis Global Capital said it expects that through the restructuring process, there will be money left over to pay unsecured creditors.

The bankruptcy ‘is a crucial step towards us being able to recover your assets,’ Gemini’s Cameron Winklevoss tweeted shortly after the filing was announced.”

A leading crypto analyst said the market had already priced in the looming bankruptcy filing of crypto brokerage Genesis Global Capital and other recent industry debacles stemming from the collapse of disgraced crypto exchange FTX.

Most of the negative news should be priced in because Genesis has been in trouble since the end of last year.

Meanwhile, traditional markets continued to stumble this week, with the S&P down 0.7% for the day. The S&P, which has a hefty technology component, is off 2.1% for the past five days, as investors remain fretful about the prospect of recession and big banks kicked off the earnings season with mixed results.”

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“The company today launched the Robinhood Wallet, a smartphone app that allows users to swap and transfer crypto, and view owned NFTs. It’s currently being slowly rolled out to over 1 million waitlisted users. The Robinhood Wallet uses Polygon, an Ethereum sidechain, to offer swaps without network fees. It also added support for Ethereum today.

The Robinhood Wallet is a completely different product housed in a separate, standalone app that allows users to have total control over their crypto and provides access to more advanced features, like connecting to decentralized apps and NFT marketplaces.”

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“The Bank for International Settlements looked under the hood of decentralized finance (DeFi) in a new working paper and introduced the DeFi stack reference (DSR) model to illustrate the technology’s functionality and risks. The report discussed the integration of DeFi with traditional finance and suggested ways to assess its risks during that integration.

We consider DeFi a relevant development because it harnesses innovative technology that might shape the future financial ecosystem.

Algorithmic automation, competitive financial engineering and transparency are of interest well beyond cryptocurrency markets.’ By competitive engineering the authors meant composability, the combining of smart contracts to form complex and unique financial products.”

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“Everything is on the table. If there is a path forward on that, then we will not only explore that, we’ll do it.

The decision would come down to whether restarting FTX’s international exchange would recover more for customers than just liquidating assets or selling the platform, Ray said. The FTX token FTT was trading up 33% on Binance on the news.”

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FTX’s Billions Detailed in Court Exhibit