Genesis Global Trading (GGT), a cryptocurrency trading company affiliated with the Digital Currency Group (DCG), will be closing down its spot trading service on September 18, as reported by Bloomberg. This decision comes after the parent company’s crypto lender, Genesis Global Capital, filed for bankruptcy in January. However, GGT stated that its closure is voluntary and has been made for business reasons. The company spokesperson also mentioned that they are working closely with regulatory authorities to ensure an orderly discontinuation of services.
According to their website, GGT began its trading operations in 2013 and is registered by the New York State Department of Financial Services. Despite GGT’s closure, the DCG-affiliated GGC International will continue to offer spot and derivatives trading services. These operations will not be affected by the shutdown of GGT.
Earlier in the year, Genesis Global Capital had filed for Chapter 11 bankruptcy due to the United States Securities and Exchange Commission (SEC) charging them with offering unregistered securities through their Earn program. The company had also experienced layoffs, suspension of withdrawals, and suffered losses in the collapse of Three Arrows Capital and FTX. These setbacks put the company in a difficult position and ultimately led to its bankruptcy filing.
Furthermore, the suspension of Genesis withdrawals led to a legal conflict with the Gemini cryptocurrency exchange. Gemini had a significant amount, around $900 million, tied up in the Genesis Earn program. The SEC charged Gemini with unregistered securities offerings simultaneously with Genesis, exacerbating the situation.
It is essential to note that DCG, led by Barry Silbert, also owns Grayscale Investments. Recently, Grayscale scored a victory in court when the SEC’s refusal to consider its application to create a Bitcoin spot exchange-traded fund was reversed. This demonstrated some positive developments for DCG’s ventures, despite the challenges faced by Genesis Global Capital.
At the time of reporting, GGT had not responded to an inquiry from Cointelegraph. The company’s closure and the overall challenges faced by the Genesis Global Capital and DCG highlight the volatility and risks associated with the cryptocurrency industry. It also emphasizes the importance of regulatory compliance and adapting to constantly evolving market conditions.
In conclusion, Genesis Global Trading’s decision to shut down its cryptocurrency spot trading service is voluntary and driven by business reasons. Despite this closure, the DCG-affiliated GGC International will continue to offer trading services. The parent company’s crypto lender, Genesis Global Capital, previously filed for bankruptcy due to charges of offering unregistered securities. This closure and bankruptcy filing have led to legal conflicts and financial challenges for the companies involved. These events showcase the volatility and risks associated with the cryptocurrency industry and the need for regulatory compliance in the evolving market.
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