Genesis Global has made the decision to shut doors on its crypto spot trading service on September 18 according to media reports. The platform is associated with the Digital Currency Group but it was not affected when the parent company’s crypto lender, Genesis Global Capital announced bankruptcy. The decision was made voluntarily as a result of some business reasons. The crypto firm is working closely with authorities to coordinate an orderly discontinuation of services.
Genesis Global is a New York-based organization that offers over-the-counter market-making services revolving around digital assets. Unlike the few crypto organizations throughout the broader market, The exchange is licensed with the New York Department of Financial Services, the Financial Industry Regulatory Authority, as well as the SEC. Despite the decision to close down crypto spot trading on the platform, both spot and derivatives trading through the firm would remain operational.
Genesis Global Landed Itself in the Crosshairs Following the Suspension of Transactions
Genesis Global made the tough decision of filing for bankruptcy earlier this year, just a week after the SEC charged it with offering unregistered securities via its Earn program. A week before that, the firm made the decision to let 30% of its workforce go amid tough business circumstances. Similarly, the company halted all withdrawals for an indefinite amount of time. The platform blamed the collapse of Three Arrows Capital for its move. Furthermore, the platform became subject to great losses following the collapse of the FTX exchange.
After making the decision to suspend all transactions on the platform, the crypto firm set the stage for a legal conflict with Gemini exchange and the Winklevoss Twins. Back then, the exchange had a sum of almost $900 million tied up in the Genesis Earn program. However, Gemini was charged by the SEC over unregistered security offerings at the same time as Genesis.
Genesis released a report for the second quarter this year that suggested that spot market liquidity had been suffering. At the same time, with the spot order book depth chronically flagging, it has become evident that a great percentage of future growth of crypto volumes would only be in derivatives.