Cryptocurrency lender Genesis has denied being on the verge of filing bankruptcy days after it stopped making withdrawals in response to the collapse of crypto exchange FTX.
Genesis said on Monday it had “no plans” to file for bankruptcy in the near future and would try to resolve the situation “amicably.”
“We have no plans to file for bankruptcy immediately,” a spokesperson told CNN Breaking News in an emailed statement. “Our goal is to resolve the current situation amicably without the need to file for insolvency. Genesis continues to have constructive discussions with creditors.”
Bloomberg News previously reported that Genesis, which has offices in New York City, London and Singapore, was struggling to raise new money for its credit unit and had warned investors that it could file for bankruptcy if it didn’t receive additional funding.
report, which cited people familiar with the matter, said the crypto investment bank spent the last few days raising at least $1 billion in new capital.
Genesis asked crypto exchange Binance for investments, but the latter rejected the proposal due to conflicts of interest, the Wall Street Journal reported on Monday, citing people familiar with the matter.
According to the Wall Street Journal report, Genesis also reached out to private equity firm Apollo Global Management for funding.
Binance declined to comment. CNN Breaking News has reached out to Apollo for comment.
Genesis Global Capital, one of the largest crypto lenders, suspended customer withdrawals last week due to a liquidity squeeze driven by a surge in withdrawal requests following the implosion of Sam Bankman-Fried’s FTX.
The collapse of FTX, the third-largest crypto exchange, earlier this month stunned the crypto industry and led to allegations of fraud and mismanagement, as well as settlements with 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 protection and accused regulators of failing to protect customers before retracting some of his comments.
Bankman-Fried and several celebrities who have promoted FTX are currently facing a $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.