Nov 16, 2022
Winklevosses’ Gemini Pauses Withdrawals on Lending Program
(Bloomberg) -- Gemini Trust Co., the cryptocurrency platform run by Tyler and Cameron Winklevoss, said redemptions by customers for its Earn program are being delayed after its partner in the product, Genesis Global, paused withdrawals on its borrowing platform amid a liquidity crunch.
Genesis is one of the main borrowers of Gemini Earn, a product used to generate yields for its customers, according to Gemini Earn’s website. Gemini is working with Genesis to allow users to redeem funds as ‘quickly as possible.” The delay doesn’t impact any other Gemini products and services, the New York-based firm said in a statement.
“The past week has been an incredibly challenging and stressful time for our industry. We are disappointed that the Earn program SLA will not be met, but we are encouraged by Genesis’ and its parent company Digital Currency Group’s commitment to doing everything in their power to fulfill their obligations to customers under the Earn program,” the statement said.
Genesis suspended lending withdrawals, as the spectacular collapse of crypto exchange FTX shocked the digital-asset industry. The firm said it has hired advisers to explore all possible options, including new funding, and will deliver a plan for its lending business next week. Genesis’ lending business had previously been affected by its exposure to bankrupt crypto hedge fund Three Arrows Capital. Trading and other services at Genesis remain operational.
The Winklevoss twins, who first became known when they challenged Mark Zuckerberg over the mantle of who invented social network Facebook, are early Bitcoin investors and believers. Last November, Gemini raised $400 million in a round of funding that valued the company at $7.1 billion.
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