Ben Zhao, 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 filings, Genesis owes its 50 largest creditors $3.4 billion, including investment unit Bybit Mirana. The filing shows that the cryptocurrency lender owes Mirana approximately $151 million.
Zhao: Bybit’s Earn product doesn’t use Mirana
in Response In a tweet referring to Mirana’s exposure to Genesis, Zhao stated that the reported $151 million contains about $120 million in collateral, which Mirana has already liquidated.
He added that the investment firm manages only a portion of Bybit’s assets. Zhao also mentioned that customer funds are segregated, and that the Bybit Earn product does not use Mirana.
1. Mirana is the investment arm of Baybit.
2. Mirana manages only a portion of the company’s assets. The customer’s fund is separated by making money not using Mirana.
3. The reported amount of 151 million contains about 120 million hedging positions previously liquidated by Mirana. https://t.co/kqVPpAMGky
– Ben Chu (@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’ financial problems were reported time and time again before finally filing for bankruptcy.
Twitter user Request Bybit provides full details of its products, including how they are managed, where they are produced and which third parties are responsible for generating returns.
another user advertiser That tweet reminded him of Caroline Ellison, the former CEO of Alameda Research, who said the financial health of the former SBF-led empire was healthy before it filed for bankruptcy in November.
Genesis files for bankruptcy
origin Archived For Chapter 11 bankruptcy protection in the US Bankruptcy Court for the Southern District of New York on January 19 after facing an acute liquidity crisis caused by harsh market conditions and exposure to several bankrupt companies, including FTX.
According to court filings, the digital currency lender has more than 100,000 creditors, between $1 billion and $10 billion in assets and liabilities worth the same amount.
Some of its biggest creditors include cryptocurrency trading platforms TwinsMoonalpha Financial (Babel Finance), Coincident Capital International Ltd, Donut Inc, Altcoinomy SA, VanEck New Finance Income Fund LP.
The Bybit founder’s post addresses concerns about the company’s $151 million exposure to Genesis bankruptcy, which first appeared on CryptoPotato.