Cryptocurrency broker Genesis Global Trading has filed a $1.2 billion claim against now-bankrupt Three Arrows (3AC), according to a 1,157-page lawsuit filed by Teneo’s bankruptcy trustee.
Genesis was to lose “hundreds of millions” to 3AC exposure
Genesis’ parent company, Digital Currency Group, took over some of Genesis’ commitments in the case, although it was unclear how many of them remained with Genesis at all.
The document shows that Genesis Asia Pacific Pte. Ltd., a subsidiary of Genesis Global, is seeking a settlement from Three Arrows in respect of assets worth $1.14 billion as well as a pledge of AVAX and NEAR tokens totaling $91.3 million.
The list of claims of creditors described in the document shows that Genesis Asia Pacific Pte. Ltd has issued Three Arrow Capital loan claims totaling $2.36 billion. The loans were partially secured by 17.4 million shares of Grayscale Bitcoin Trust (GBTC), 446,928 shares of Grayscale Ethereum Trust (ETHE), 2.7 million AVAX tokens and 13.9 million NEAR tokens – all liquidated by Genesis.
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Genesis issued a margin call to Three Arrows Capital through the American Arbitration Association, seeking collateral to cover the shortfall. When Three Arrows failed to provide the required collateral, Genesis sent a default notice stating that the entire balance of the loan had been paid.
Last month, the market reported that Genesis faces “hundreds of millions of dollars” in losses due to exposure to Three Arrows Capital, known as 3AC. Three Arrows Capital filed for bankruptcy on July 1. The lender’s problems were allegedly caused by the collapse of the digital asset market that had been going on for months.
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