The current crypto crash is a bane for many crypto firms, and Genesis Trading is one of the many to suffer in this bear run. In a recent Twitter thread, Micheal Moro, CEO of Genesis Trading, has confirmed that the third party they mitigated losses with in June is none other than Three Arrows Capital (3AC).
Genesis Trading’s losses are a result of the exposure to Three Arrows Capital and Babel Finance. Three Arrows Capital, the over-leveraged hedge fund, is currently undergoing liquidation by a British Virgin Islands court.
Moro said that after 3AC missed a margin call on funds borrowed from Genesis, the company was able to reduce losses. Furthermore, he stated that the company worked with Digital Currency Group (DCG) to devise an optimal strategy. DCG is the parent company of Genesis trading.
Moro states,
“DCG has assumed certain liabilities of Genesis related to this counterparty to ensure we have the capital to operate and scale our business for the long-term.”
He also said that the company is pursuing all strategies to recover the residual loss.
Will Genesis Trading survive the winter?
Moro assures his clients that Genesis Trading will continue to support their needs as they move to the next phase of the industry’s evolution. Also, he says that his company deploys several risk management strategies to protect clients’ portfolios. He said that the company works towards mitigating losses quickly and effectively.
Nonetheless, this crypto winter has seen the fall of many big firms. According to reports, Genesis trading is facing losses in the hundreds of millions, and meanwhile, Three Arrows Capital’s losses had gone into the billions.
Also, Genesis trading is yet to disclose its complete exposure to 3AC, and the team is probably waiting for the right moment as the number might be high.
Likewise, Voyager Digital is another firm that suffered heavy losses due to its exposure to 3AC. As recently revealed, its clients might not get back everything the company owes them.