Genesis Trading is struggling to raise new capital and warned of a possible restructuring in the wake of the FTX bankruptcy. It has frozen retirement funds held by Bitcoin IRA customers.
Genesis recently had $175 million worth of its assets frozen on FTX. Its parent company, Barry Silbert’s Digital Currency Group (DCG), gave it $140 million in new equity funding but reportedly owed Genesis Trading $575 million from another loan. Genesis Trading бар болчу $2.8 billion in outstanding loans as of the third quarter of 2022 ⏤ some of them due to hedge funds and family offices.
Башталыш бар жалданма a restructuring advisor to explore strategic options, including possible bankruptcy. Predictions betting platform Polymarket берди Genesis a 59% chance of insolvency before the end of 2022. That figure should be caveated insofar as that prediction market once peaked at 81%, meaning that at least in comparison to the peak moment of fear, a few less people are betting that the Genesis Trading situation is going under.
Genesis Trading does not seem as confident in making it to a prosperous 2023. It has токтоду withdrawals on its lending platform, impacting individuals who hold digital assets in certain retirement accounts. Several of Genesis’ creditors have сакталат lawyers to pursue a possible restructuring, lawsuit, or discussions to limit damage.
Подробнее: FTX 3 кредиторлорго 50 миллиард доллар карыз, анын ичинде Genesis жана BlockFi
Retirees with a Bitcoin IRA plan exposed to Genesis’ failure
A company named Bitcoin IRA ишке its so-called IRA Earn product in February 2021. IRA Earn offered interest rates as high as 6% annually. Behind the scenes, Bitcoin IRA worked with Genesis for its IRA Earn product. Now that Genesis has halted withdrawals of deposits on its lending platform, retirees may have had retirement funds frozen if they used Bitcoin IRA.
By sending depositors’ money to Genesis, Bitcoin IRA likely had көрсөтүү via Genesis to now-bankrupt companies like FTX and Three Arrows Capital (3AC). Digital Currency Group had to write off a $1.2 billion loan to 3AC, absorbing the loss to rescue Genesis.
Even if Bitcoin IRA managed to pull some of the funds off Genesis Trading before it froze withdrawals, other depositors will have to wait until a claim passes restructuring or bankruptcy proceedings — which can take years.
Подробнее: Genesis Trading хронологиясы крипто алууларды токтотуу
The situation caused jitters among government officials, along with investors. New York Attorney General Letitia James мындай деди: on record with her opposition to Congress’ Retirement Savings Modernization Act that proposes to permit retirement accounts to hold digital assets. Letitia James also opposes the Financial Freedom Act of 2022, which would forbid the Department of Labor to constrain or prohibit investment options like digital assets in self-directed brokerage accounts.
Earlier this year, Treasury Secretary Janet Yellen деп аталат digital assets unsuitable for retirement accounts due to their volatility.
Bitcoin IRA’s exposure to Genesis Trading highlights the risk of depositing digital assets in a third-party platform that promises an attractive interest rate. Celsius Network and BlockFi typified the risk of high-yield crypto accounts; both are now bankrupt.
Bitcoin IRA’s Earn page is no longer active. Not only this, it looks to have deleted a number of eyebrow-raising disclosures.
Genesis Trading may become the latest victim of a bad year for digital asset investment companies. It already froze withdrawals of deposited assets. This move could hurt owners of retirement accounts who deposited funds on Bitcoin IRA’s IRA Earn product.
Көбүрөөк маалымат алуу үчүн, бизди ээрчиңиз Twitter жана Google Маалымат же биздин иликтөө подкастыбызды угуңуз Инновация: Blockchain City.
Source: https://protos.com/bitcoin-ira-deposits-at-genesis-could-leave-retirees-broke/