Genesis Global Capital, the lending business of cryptocurrency brokerage Genesis, is halting redemptions and new loan originations Wednesday as the implosion of crypto exchange FTX continues to rattle the broader crypto ecosystem. The FTX downfall has resulted in "abnormal withdrawal requests which have exceeded our current liquidity," Genesis wrote in a string of Twitter posts . The company said it hired advisors to "explore possible options," including sourcing new liquidity, and will deliver a plan for its lending arm next week. Of note, Genesis Global Capital, which serves institutional clients, had $8.4B in loan originations in Q3, down from $44.3B in Q1, according to its website . Genesis's spot and derivatives trading and custody businesses, meanwhile, "remain fully operational," it said. It disclosed last week that it had ~$175M of derivative losses from FTX, underscoring the punishing period that the emerging space has faced in the aftermath of FTX's meltdown. "The focus now is on the spill over to Digital Currency Group (DCG), holding company to Genesis," Bernstein analyst Gautam Chhugani wrote in a note. "DCG's primary business is its asset management business called Grayscale, which runs the Grayscale Bitcoin Trust ( OTC:GBTC ), Ethereum Trust ( OTCQX:ETHE ) and 13 other asset management products." The crypto broker has already suffered big losses earlier this year following the collapse of crypto hedge fund Three Arrows Capital .
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