Genesis Trading CEO confirms 3AC exposure, parent company helps plug losses #Genesis #Trading #CEO #confirms #3AC #exposure #parent #company #helps #plug #losses Welcome to TmZ Blog, here is the new story we have for you today:
Digital Currency Groups market maker and lending firm Genesis Trading has confirmed that it had investment exposure in the now-liquidated Three Arrows Capital (3AC).
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The insolvency and subsequent liquidation order of the embattled company sent shockwaves through the cryptocurrency space last week amid an ongoing downturn across crypto markets. A major talking point was the stake other prominent companies had in the now-defunct cryptocurrency hedge fund and the ongoing fallout.
Genesis Trading is among prominent lending firms that had exposure to 3AC, which has now been confirmed by CEO Michael Moro. The companys chief said the firm had managed to mitigate losses after 3AC had failed to meet a margin call on capital borrowed from Genesis.
1/ As part of our goal in providing transparency to the market, I wanted to share the latest update at @GenesisTrading.
— Michael Moro (@michaelmoro) July 6, 2022
While Moro stopped short of revealing how much it had lent to 3AC, he unpacked the terms of the firms loan to the hedge fund and the subsequent chain of events after the debtor failed to meet its repayment obligations:
The loans to this counterparty had a weighted average margin requirement of over 80%. Once they were unable to meet the margin call requirements, we immediately sold collateral and hedged our downside.
Related: The crypto industry needs a crypto capital market structure
Genesis Trading’s parent companyDigital Currency Group has assumed some of the liability owed by 3AC in order to ensure Genesis has adequate capital to continue its operations. The firm will continue to explore options to try and recoup losses in the wake of 3ACs collapse.
Reports suggest that Genesis is facing losses in the hundreds of millions of dollars while the company is yet to disclose the details of its exposure to 3AC. Cointelegraph has reached out to the market maker for comment.
Voyager Digital was another casualty of 3ACs collapse as the cryptocurrency exchange was forced to postpone trading, deposits and withdrawals at the start of Jul. The hedge fund failed to repay a 15,250 Bitcoin (BTC) and 350 million USD Coin (USDC) loan to the American exchange.