Genesis Global Trading, a prominent crypto lender, filed for Chapter 11 bankruptcy protection in New York on Jan. 20, becoming the latest company to declare bankruptcy in the wake of FTX\u2019s collapse. However, the focus of the crypto community has shifted toward other firms that had exposure to the lending firm.<\/p>\n
One report suggested that a total of nine crypto firms had exposure to Genesis, including Gemini, Bybit, VanEck, Decentraland and others. Bybit CEO Ben Zhou was quick to respond to the reports and clarified that Bybit indeed had $150 million exposure to the bankrupt crypto lender via its investment arm Mirana.<\/p>\n
Zhou noted that Mirana only managed a portion of Bybit\u2019s assets and the reported $151 million exposure has about $120 million of collateralized positions, which Mirana had already liquidated. He also assured that client funds are separated and Bybit\u2019s earn products don\u2019t use Mirana.<\/p>\n
While many appreciated the quick clarification from the co-founder, many others had more questions regarding the clarification, especially about the company\u2019s earn products. <\/p>\n
Related:\u00a0Gemini and Genesis charged by SEC with selling unregistered securities<\/em><\/strong><\/p>\n One user demanded\u00a0full disclosure about the earn products and how yields are generated. Another user questioned their relationship with Mirana, asking whether they are operating on a similar strategy to FTX\/Alameda.<\/p>\n Others were puzzled by the timing of the revelation, given Genesis\u2019s well-known troubles. Some of its biggest lenders, such as Gemini, have been actively demanding action against Genesis\u2019s parent company, the Digital Currency Group. One user wrote,<\/p>\n \u201cTweeting \u2018full disclosure\u2019 only when caught with your pants down automatically refutes your claim. If this was \u2018full disclosure\u2019 ByBit would have said it months ago.\u201d<\/p><\/blockquote>\n Many others demanded proof of transactions between Bybit and Marina for assurance while reminding\u00a0Zhou that similar statements have been made in the past by FTX executives.<\/p>\n Cointelegraph reached out to Bybit to get some clarity on its earn program and raise some of the community\u2019s questions but received no response by the time of publication.<\/p>\n