Cryptocurrency lender Genesis is preparing to file for bankruptcy, Bloomberg News reports

Genesis Global Capital plans to file for bankruptcy as soon as this week, Bloomberg News reported Wednesday, citing people familiar with the situation.

It had been expected to file for bankruptcy for weeks, after the company froze customer refunds on November 16 following the collapse of major cryptocurrency exchange FTX.

The November crash of FTX claimed multiple victims, including crypto lender BlockFi and Core Scientific Inc, one of the largest publicly traded cryptocurrency mining companies in the US, both of which filed for bankruptcy protection in the following months.

Genesis, parent cryptocurrency consortium, and creditors have exchanged several proposals, but have so far failed to reach an agreement, Bloomberg reports. Report adding that Kirkland, Ellis and Proskauer Rose advise groups of creditors.

Genesis did not immediately respond to a Reuters request for comment.

Genesis has also come into conflict with Gemini, which was founded by identical twin cryptographers Cameron and Tyler Winklevoss.

Gemini offered a crypto lending product called Earn in partnership with Genesis, and now says Genesis owes it $900 million in connection with that product.

The US Securities and Exchange Commission said last week that it had charged Genesis and Gemini with illegally selling securities to hundreds of thousands of investors through its cryptocurrency lending program.

Additional reporting by Nikit Nishant and Mehnaz Yasmin in Bengaluru; Edited by Sriraj Kalluvila

Our standards: Thomson Reuters Trust Principles.

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