Digital Currency Group’s Genesis Global Capital to Declare Bankruptcy Due to Liquidity Crisis

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Two reports on the metaverse were released on Wednesday by the World Economic Forum (WEF) at Davos. According to the report, “The way we communicate, work, and play will change thanks to the immersive, synchronous, and interoperable digital environment known as Metaverse.” The world has yet to see or experience anything concrete, despite the hype surrounding the idea. Chris Cox, CEO of Meta, said that platform would someday surpass the smartphone in importance. “It doesn’t happen unless you develop an open system similar to the early internet, [where] anyone interested can latch on to a shared protocol,” said Neal Stephenson. Making various digital ecosystems interact was another issue on the agenda for central bankers, who met with the heads of the financial infrastructure inside the Congress Center to talk about central bank digital currencies. Lesetja Kganyago, governor of the South African central bank, claims that rather than technology, CBDCs are frequently a result of incompatible governmental and legal structures. Javier Perez Tasso, the CEO of SWIFT, issues a warning about the possible costs of creating “digital islands” as opposed to integrating payment systems. CEO of Euroclear Believe Mostrey: “Migration will be impossible if we don’t get that right.”

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The Digital Currency Group (DCG) subsidiary Genesis Global Capital is getting ready to declare bankruptcy as soon as this week. In a Jan. 18 Bloomberg report, it was stated that Genesis had previously stated it would consider declaring bankruptcy if it were unable to raise money due to a liquidity crisis. After accusing Genesis and cryptocurrency exchange Gemini of marketing unregistered securities, the U.S. Securities and Exchange Commission (SEC) released the report. Three Arrows owed Genesis $447.5 million, according to information provided by Silbert to investors in January. Prior to filing for bankruptcy in November, Genesis also held over $175 million on FTX, which probably added to the company’s cash flow problems and risk of collapse.

The crypto exchange Bitzlato is classified by the U.S. Treasury Department as a “primary money-laundering concern,” one of the most significant sanctions in the government’s arsenal for solving crimes since it isolates a company from the international financial system. According to Deputy Attorney General Lisa Monaco during the news conference, the Hong Kong-based platform Bitzlato has been effectively shut down and its founder Anatoly Legkodymov has been placed in American custody. This will prevent Bitzlato from providing services to criminals with ties to Russia.

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