The problems of the cryptocurrency industry continue on Thursday also sink deposits, layoffs and lawsuit added to disturbance of 2022, dominated by falling prices and high-profile bankruptcies.
repercussions of the collapse of FTX and crypto exchange criminal charges leveled against Its founder, Sam Bankman-Fried, weighed heavily on sector this week. Among those hit It was Genesis Global Capital, which developed off staff, and cryptocurrency-focused Silvergate Bank, which posted a significant decline in deposits.
Bankman Fried on Tuesday pleaded not guilty to eight criminal The charges including wire fraud and money laundering Conspiracy. 30-year-old charged of Loot FTX Clients Deposits To support its Alameda Research hedge fund, buy real estate and donation millions of dollars to politics causes.
Another crypto entrepreneur, Alex Machinsky, founder of W former Executive Director of percentile network, also Legal encounter battle on Thursday. a new The lawsuit is filed by a New York attorney general Mashinsky allegedly defrauded investors by concealing poor health of His now bankrupt cryptocurrency lending platform.
While Machinsky was CEO between 2021 and 2022, Celsius made Almost a billion dollars in loans to Alameda Research, according to the lawsuit.
The civil suit seeks to prevent Mashinsky from doing so business in New York and make him pay damages for violate state laws.
“It’s like a shot across the bow for other founders of destinations like said founder Todd Phillips of Philips Policy Consulting LLC.
Meanwhile, Silvergate Capital Corp. posted a sharp decline drop in The fourth quarter is cryptocurrency-related deposits on Thursday as panicked investors pulled out of the FTX crash out more From $8 billion, sent shares of the bank down over 43%.
US attorney told the bankruptcy court on Wed that prosecutors captured the United States bank Accounts at Silvergate and Farmington State Bank affiliates with FTX based in the Bahamas businessknown as FTX Digital Markets.
Accounts at Silvergate Bank and Farmington State Bank, you do business Court records showed that Moonstone possessed about $143 million.
Silverjet also It said it would cut its workforce by 40%, or about 200 employees, to rein it in in costs as the downturn deepened in the industry. origin also plans to reduce 30% of its workforce in a second round of Layoffs in less than six months, according to a familiar person with Subject.
Genesis, no brokers digital assets for financial institutions like hedge funds and asset managers, announced in November, the cryptocurrency lending arm will stop making them new Loans and prevent customers from withdrawing money, citing market disturbance caused by failure of FTX.
layoffs were first Reported by The Wall Street Journal, which also He said Genesis is considering the submission for Chapter 11 bankruptcy. The company is working with investment bank Moelis & Co. for evaluation optionssaid the report quoting people familiar with Subject.
Gemini cryptocurrency exchange, which had a cryptocurrency lending product in partnership with Genesis and its creditors were in turmoil for solve for avoid A situation similar to FTX’s rapid descent into bankruptcy.
Cameron Winklevoss, who Gemini foundations with his twin brother and on Monday accused Barry Silbert, CEO of origin’ parent Digital Currency Group, of “bad Faith booth tactics and asked him commit For a $900 million solution worth of disputed client assets by January 8th.
