Crypto lending platform Genesis Trading announced today, Jan 5th, 2023 that it would be laying off 30% of its workforce in the wake of the current financial and market conditions as the Wall Street Journal reported.
- Genesis Trading stated that it will cut its workforce by 30%.
- The company laid off 20% of its staff earlier, replacing its CEO last year by making him move more to an advisory position.
- DCG has been accused of “bad faith” tactics by Cameron Winklevoss, CEO of crypto exchange Gemini and a Genesis client.
Barry Silbert’s Digital Currency Group (DCG) is facing mounting pressure from creditors and the potential threat of bankruptcy as its crypto lending arm, Genesis Trading, stated that it will cut its workforce by 30%. This decision drastically reduces the headcount of the workforce.
The company laid off 20% of its staff earlier, replacing its CEO last year by making him move more to an advisory position. This makes it the second layoff in a space of six months, this latest round of layoffs will see 60 positions eliminated, leaving Genesis with 145 employees. The company’s financial crisis deepened after the bankruptcy of the crypto hedge fund Three Arrows Capital and the market turmoil of 2022. Genesis sought an emergency loan of $1 billion following the collapse of Alameda Research, a major client. The firm froze redemptions for all clients after crypto exchange FTX filed for bankruptcy protection in November.
DCG has been accused of “bad faith” tactics by Cameron Winklevoss, CEO of crypto exchange Gemini and a Genesis client, who claims the company owes $1.675 billion to Gemini customers and other creditors. Silbert has denied the claims, stating that DCG has not borrowed $1.675 billion from Genesis and is current on all outstanding loans.
Although Genesis Trading hasn’t publicly filed for bankruptcy, if it eventually does it would join a growing list of former cryptocurrency giants who have faced financial insolvency, including Alameda, BlockFi, Celsius, FTX, Three Arrows, and Voyager, all of which filed for bankruptcy in the past year.
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