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Genesis Files $1.2B Claim Against Three Arrows Capital

Genesis's parent company, Digital Currency Group, has assumed Genesis' liabilities in the case.

By Oliver Knight
AccessTimeIconJul 18, 2022 at 5:06 p.m. UTC
Updated May 11, 2023 at 5:34 p.m. UTC
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Crypto broker Genesis Global Trading, has filed a $1.2 billion claim against the now insolvent Three Arrows Capital, according to a 1,157-page court filing uploaded by bankruptcy trustee Teneo.

Digital Currency Group, parent of both Genesis and CoinDesk, has assumed the entire $1.2 billion claim, leaving Genesis with no outstanding liabilities tied to Three Arrows Capital.

  • The filing indicates that Genesis Asia Pacific Pte. Ltd., a subsidiary of Genesis Global, sought relief from Three Arrows regarding assets of $1.14 billion, as well as pledged AVAX and NEAR tokens worth a total of $91.3 million, on June 15.
  • A list of creditor claims on the document reveals that Genesis Asia Pacific Pte. Ltd. made demands for breached Three Arrows Capital loans totaling $2.36 billion.
  • The loans were partly collateralized with 17.4 million shares of the Grayscale Bitcoin Trust (GBTC), 446,928 shares in Grayscale Ethereum Trust (ETHE), 2.7 million AVAX tokens and 13.9 million NEAR tokens – all of which have been liquidated by Genesis.
  • Genesis issued a margin call to Three Arrows Capital via the American Arbitration Association seeking collateral to make up the shortfall. When Three Arrows failed to provide the required collateral, Genesis sent a notice of default, stating that the entire loan balance was due.
  • Last month, sources told CoinDesk that Genesis faced losses in the "hundreds of millions" because of its exposure to Three Arrows Capital, which is also known as 3AC.
  • Three Arrows Capital filed for Chapter 15 bankruptcy in the Southern District of New York on July 1.

UPDATE (July 18, 19:06 UTC): Updates headline, lead paragraph and first bullet point with information about Genesis' claim against Three Arrows Capital. Also adds CoinDesk's relationship with DCG and Genesis.

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CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

Oliver Knight
Oliver Knight

Oliver Knight is a CoinDesk reporter based between London and Lisbon. He does not own any crypto.

Follow @OKnightCrypto on Twitter

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