Genesis’ comments come days after it halted customer withdrawals due to liquidity difficulties.
Cryptocurrency lender Genesis has denied being on the verge of declaring bankruptcy, days after halting withdrawals in response to the collapse of crypto exchange FTX.
Genesis said on Monday it had “no intention” of filing for bankruptcy in the immediate future and would seek to resolve the situation “on a consensual basis.”
“We do not intend to file for bankruptcy imminently,” a spokesperson told Al Jazeera in an emailed statement. “Our goal is to resolve the current situation in a consensual manner without the need to file for bankruptcy. Genesis continues to have constructive conversations with creditors.
Bloomberg News earlier reported that Genesis, which has offices in New York, London and Singapore, was having difficulty raising new funds for its lending unit and warned investors it could file for bankruptcy if it doesn’t. did not get additional funding.
The report, which quotes people familiar with the matter, says the crypto investment bank has spent the past few days trying to raise at least $1 billion in new capital.
Genesis sought investment from crypto exchange Binance, but the latter declined the suggestion due to conflict of interest concerns, The Wall Street Journal reported on Monday, citing people familiar with the matter.
Genesis has also approached private equity firm Apollo Global Management for funding, according to the Wall Street Journal report.
Al Jazeera has reached out to Apollo and Binance for comment.
Genesis Global Capital, one of the largest crypto lenders, suspended client withdrawals last week due to what it said was a liquidity crunch caused by an increase in withdrawal requests following the implosion of the cryptocurrency. FTX by Sam Bankman-Fried.
The collapse of FTX, the third-largest crypto exchange, earlier this month stunned the crypto industry, prompting allegations of fraud and mismanagement as well as comparisons to the collapse of Lehman Brothers in 2008.
In an interview with Vox last week, FTX founder Sam Bankman-Fried, who resigned as CEO earlier this month, said he regretted his decision to file for bankruptcy and accused regulators of failing to protect customers before appearing to back down on some of his comments.
Bankman-Fried and several celebrities who promoted FTX are currently facing an $11 billion class action lawsuit from investors.
The US Department of Justice and the Securities and Exchange Commission are also reportedly investigating whether Bankman-Fried or his company violated securities law.