© Reuters. FILE PHOTO: Representations of digital cryptocurrencies are positioned on U.S. greenback banknotes on this illustration taken November 28, 2021. REUTERS/Dado Ruvic/Illustration/File Picture
By Hannah Lang
(Reuters) – Enterprise capital firm Digital Forex Group, which owns Genesis Buying and selling and cryptocurrency asset supervisor Grayscale, owes $575 million to Genesis’ crypto lending arm, Chief Govt Barry Silbert mentioned in a letter to shareholders on Tuesday afternoon.
Loans from Genesis World Capital, which suspended buyer withdrawals final week, have been used to “fund funding alternatives” and repurchase inventory from non-employee shareholders, Silbert mentioned within the letter, which was seen by Reuters. That debt is due in Might 2023, he added.
Except for the cash owed to Genesis, Digital Forex Group’s solely debt is a $350 million credit score facility from “a small group of lenders” led by funding agency Eldridge, in addition to a $1.2 billion declare it filed in July towards bankrupt crypto hedge fund Three Arrows Capital. Digital Forex Group (DCG) had assumed that legal responsibility from Genesis.
DCG continues to be on tempo to do $800 million in income this 12 months, Silbert mentioned.
In suspending redemptions and pausing new loans, Genesis World Capital cited the “unprecedented market turmoil” that rippled via the market after crypto alternate FTX filed for chapter. On the time, DCG mentioned the halted withdrawals at Genesis had no affect on its operations or subsidiaries.
Silbert additionally informed shareholders he appreciated phrases of help “together with presents to put money into DCG” and that he would notify traders if the corporate decides to do a funding spherical. Genesis is in search of to boost as a lot as $1 billion, and has approached crypto alternate Binance and asset supervisor Apollo World Administration (NYSE:) for help, the Wall Road Journal reported on Monday.
(This story has been corrected to say that Digital Forex Group owes Genesis Buying and selling’s crypto lending arm, not the opposite method round, in paragraph 1)
