Genesis Clients,

There is a lot happening right now in the crypto markets and the industry at large. Our goal with you, our clients, is always to be as direct and transparent as possible. Many of you have been Genesis clients for a long time and your partnership is our number one priority.

We recognize how hard this past week has been on you given the impact of last week’s FTX news. We are entirely focused on doing everything we can to serve you and navigate these difficult markets.

Since 2013, Genesis has been a pioneer in the institutional digital asset markets, offering a full suite of services in the digital asset space. The company has three primary business lines: spot and derivatives trading, lending and borrowing, and custody.

Our spot and derivatives trading and custody businesses remain fully operational. We continue to support our clients who rely on us during volatile market conditions to manage their risk and execute on their business strategies. I would like to emphasize that Genesis Trading which is our broker/dealer and holds our BitLicense is independently capitalized and operated – and separate from all other Genesis entities.

The default of 3AC negatively impacted the liquidity and duration profiles of our lending entity Genesis Capital. Since then, we have been de-risking the book and shoring up our liquidity profile and the quality of the collateral. However, FTX has created unprecedented market turmoil, resulting in abnormal withdrawal requests which have exceeded our current liquidity.

Our number one priority is to serve you, our clients, and preserve your assets. Therefore, in consultation with our professional financial advisors and counsel, we have taken the difficult decision to temporarily suspend redemptions and new loan originations in the lending business. We are working diligently to shore up the necessary liquidity to meet our lending client obligations, in a fair and responsible manner.

We have hired the best advisors in the industry to explore all possible options. Next week, we will deliver to you a plan for the lending business. We are working tirelessly to identify the best solutions for our lending business, including among other things, sourcing new liquidity.

We are pushing for a proposal to present next week targeting the best outcome possible for all of you.

We are committed to remaining transparent with you.

We appreciate your patience and resilience during these difficult times.

Regards,
Derar Islim
Interim CEO, Genesis