- Genesis Trading stored over $175 million in an FTX trading account.
- The Bahamas Securities Commission said that it had frozen the assets of FTX Digital Markets.
Genesis Trading, the market maker and lending arm of Digital Currency Group, disclosed that its derivatives division had over $175 million funds stored in an FTX trading account. Also, the trading company confirmed that it has no ongoing business ties with FTX or Alameda Research, the cryptocurrency trading company run by FTX CEO Sam Bankman-Fried. In addition, Genesis trading’s operational capital and net holdings in FTX are not relevant to their business.
As part of our goal in providing transparency around this week’s market events, the Genesis derivatives business currently has ~$175M in locked funds in our FTX trading account. This does not impact our market-making activities.— Genesis (@GenesisTrading) November 10, 2022
Further, the rejection of a continued connection comes after other companies in the cryptocurrency sector tried to separate themselves from the fallout from FTX, including Tether, Circle, Kraken, and Coinbase all announcing that they are not exposed to any of the insolvent companies.
FTX on its Worst Phase
A famous news site leaked a balance sheet that revealed FTX’s native token, FTT, was a major source of profit for Bankman-Fried’s trading company Alameda Research. Following that, Binance CEO Changpeng Zhao announced that his company would sell its all FTT holdings. As a result of this statement, users flood the exchange with withdrawal requests, and FTT drops by 72%.
However, CZ stated on November 8 that it would acquire the FTX exchange. The next day suddenly Binance made the decision not to pursue a non-binding agreement to save the rival company. On the same day, FTX stopped accepting new clients and withdrawals until further notice.
Moreover, on November 10, the Bahamas Securities Commission said that it had frozen the assets of FTX Digital Markets, a division of FTX. Also, Debbie Stabenow, chair of the U.S. Senate Agriculture Committee, stated that with the demise of FTX, Congress must pass legislation.