Ben Zhao, the founder of cryptocurrency exchange Bybit, took to Twitter to address concerns raised about the company’s exposure to now-bankrupt cryptocurrency lender Genesis Global Capital.
According to court documents, Genesis owes its top 50 creditors $3.4 billion, including Bybit’s investment unit Mirana. The filing shows that the crypto lender owes Mirana approximately $151 million.
Zhao: Bybit’s earnings product does not use Mirana
In reply To a tweet mentioning Mirana’s exposure to Genesis, Zhao stated that the reported $151 million has about $120 million in collateralized positions, which Mirana had already liquidated.
He added that the investment firm only manages a portion of Bybit’s assets. Zhao also stated that client funds are segregated and Bybit’s earnings product does not use Mirana.
Full disclosure:
1. Mirana is the investment arm of bybit.
2. Mirana only manages some assets of the bybit company. The client fund is separated and the product earned per bit does not use mirana.
3. The 151 million reported have approximately 120 million collateralized positions that Mirana had already liquidated. https://t.co/kqVPpAMGky— Ben Zhou (@benbybit) January 20, 2023
The crypto community reacts
The Bybit founder’s tweet sparked several reactions on Crypto Twitter, with some users questioning the timing of the clarification given that Genesis’s financial woes were repeatedly reported before it finally filed for bankruptcy.
A Twitter user required that Bybit provide full details of its products, including how they are managed, where they are generated, and the third parties responsible for generating the performance.
another user fixed that the tweet reminded Caroline Ellison, the former chief executive of Alameda Research, saying the financial state of the former SBF-led empire was healthy before filing for bankruptcy in November.
Genesis files for bankruptcy
Genesis archived for Chapter 11 bankruptcy protection in the United States Bankruptcy Court for the Southern District of New York on January 19 after facing a severe liquidity crisis, which was due to extreme market conditions and exposure to several bankrupt companies, including FTX.
According to court documents, the crypto lender has more than 100,000 creditors, between $1 billion and $10 billion in assets and liabilities for the same amount.
Some of its biggest creditors include the cryptocurrency exchange GeminiMoonalpha Financial (Babel Finance), Coincident Capital International Ltd, Donut Inc, Altcoinomy SA and VanEck New Finance Income Fund LP.
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This post Bybit founder addresses concerns about company’s $151 million exposure to Genesis bankruptcy
was published first on https://cryptopotato.com/bybit-founder-addresses-concerns-over-firms-151m-exposure-to-bankrupt-genesis/
