VALUE?????
I was born at night, but it wasn't last night.
Value is THIS:
Posted on 11/22/2022 6:37:38 AM PST by george76
Genesis Global Trading could be poised for bankruptcy less than two weeks after fellow cryptocurrency exchange FTX suddenly imploded.
According to a Monday report from Bloomberg, Genesis has been facing a liquidity crunch as users spooked by the collapse of FTX began rapidly withdrawing their assets. Unnamed sources told the outlet that executives at Genesis have spent the past several days asking investors for $1 billion in fresh capital, which has not yet materialized.
“We have no plans to file bankruptcy imminently,” a spokesperson for Genesis told Bloomberg. “Our goal is to resolve the current situation consensually without the need for any bankruptcy filing. Genesis continues to have constructive conversations with creditors.”
FTX, which had been controlled by 30-year-old multibillionaire Sam Bankman-Fried, filed for bankruptcy after users discovered that trading firm Alameda Research, a company run by former Bankman-Fried love interest Caroline Ellison, had allegedly been using funds from FTX to make investments. Binance initially made an offer to bail out the company but withdrew the proposal, leading to the venture’s collapse and the resignation of Bankman-Fried.
Leaders at Genesis have also been in talks to receive an investment from Binance, which is led by chief executive Changpeng Zhao. No such deal has yet been made, according to Bloomberg.
Genesis is owned by Digital Currency Group, which also holds investments in popular exchange platform Coinbase and several dozen other cryptocurrency companies, according to a report from Axios. Genesis ceased withdrawals and new loan originations last week and has been relatively silent over the past several days.
At Genesis we are entirely focused on doing everything we can to serve our clients and navigate this difficult market environment,” the company said on social media last Wednesday. “FTX has created unprecedented market turmoil, resulting in abnormal withdrawal requests which have exceeded our current liquidity.”
Lawmakers increased their skepticism of the cryptocurrency sector in response to the crises. A letter from four members of the Senate Banking Committee to multiple regulators expressed concern over SoFi Technologies, a company that operates as a bank holding company and owns a subsidiary cryptocurrency exchange. “Over the past year, several meltdowns in the crypto market have wiped out trillions in value, including another huge crash last week,” the lawmakers told SoFi CEO Anthony Noto, requesting information on the company’s compliance with banking standards.
Another report from Bloomberg indicated that federal prosecutors in the Southern District of New York had been conducting a probe into FTX and other cryptocurrency companies with domestic and overseas branches over concerns about money laundering and terrorism financing. FTX is based in the Bahamas and incorporated in Antigua and Barbuda.
John Ray III, the lawyer who represented plaintiffs after the collapse of Enron, said that the cryptocurrency empire run by Bankman-Fried was the worst failure he has ever witnessed. “Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here,” Ray, who succeeded Bankman-Fried as chief executive to manage the bankruptcy, said in court documents. “From compromised systems integrity and faulty regulatory oversight abroad, to the concentration of control in the hands of a very small group of inexperienced, unsophisticated and potentially compromised individuals, this situation is unprecedented.”
And Segway stocks
A bank should have the assets to pay off their liabilities, a Ponzi scheme, not so much.
If by “creditors” they mean people with accounts, the only “constructive conversation” I would want to have is, “Here’s your money”.
Oh Crypto will go on for a while yet, as long as the institutional investors keep knowing how easily they can manipulate the market and keep pump and dumping, it will keep going....
Bigger Fools haven’t stopped showing up yet.
Calling these entities “exchanges” is a fraud. An exchange is a place where buyers and sellers meet to trade, for example, the New York Stock Exchange. I never heard of an exchange experiencing an ole fashioned bank run. The reason is these crypto “exchanges” are in fact fracticional reserve banks.
VALUE?????
I was born at night, but it wasn't last night.
Value is THIS:
>Bigger Fools haven’t stopped showing up yet.
By the time the prices start to rise the Senate will regulate crypto and say “see!? we fixed the problem!”
If the New York Stock Exchange banned margin transactions then your description would be correct.
With panic and margin calls collapse is always possible.
But they aren’t holding dollars. I am sure the account holders are looking to convert back to dollars, unfortunately for them they are trying to sell something that has much less or no value now. Can’t liquidate unless you have willing buyers.
I’m sure Biden will offer reimbursement, just like the student loan program.
I think I’m glad I know nothing about cryptocurrency.
Tesla (TLA) down 50% this year.
How is Doge doing? Still love the meme because Dogs. :-)
“A bank should have the assets to pay off their liabilities”
Agreed, but they do not hold enough cash to pay off all their depositors at once. That’s why a bank run is always bad. The money you deposit is loaned out to others in the form of mortgages and car loans. Try cashing a large check or withdrawing several $thousand on a Friday. Most banks hold limited cash. The main difference is with a bank, you MAY eventually get your money. A Ponzi scheme, not so much.
All of these craptocoins are worthless! Some just explode sooner than others.
Bitcoin, Binance, $COIN, Dogecoin whatever ... they’ll turn out worthless too!
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