Genesis Global Capital to be investigated by US State regulators, fearing FTX's connection
|- Genesis Global Capital recently announced it could potentially file for bankruptcy due to an FTX-induced liquidity crunch.
- Despite fears of contagion, one of Asia's biggest crypto lenders, Matrixport, is aiming at a $1.5 billion valuation.
- FTT recovered by 12% in the last four days following the crypto market's improved conditions.
Genesis Global Capital has been in a downfall since the second quarter, which saw the downfall of firms like Three Arrows Capital. The collapse of FTX made the situation far worse for the lending platform. To make things furthermore problematic, the company is now being pursued by regulatory authorities.
Genesis Global Capital falls at regulators' crosshair
Genesis Global Capital (Genesis), the lending arm of the Digital Currency Group (DCG), is reportedly being investigated by US State security regulators. According to the report from Barron's Genesis is part of a multi-state investigation into the interconnectedness of crypto firms. Genesis is also said to be investigated for its connection to retail investors and will also be inquired about other industry participants' involvement in security law violations.
The Alabama Securities Commission Director Joseph Borg stated that the investigation would look into crypto companies' operations. This will reveal whether or not Genesis and other companies prompted crypto investments without making proper registrations.
Earlier this week, as reported by FXStreet, Genesis was looking at a potential bankruptcy filing due to the liquidity crunch that came with FTX's collapse. However, the lending platform confirmed that it would first attempt to raise $1 billion and fix the liquidity crisis.
Crypto company goes for a bite
The current market conditions are as it making it difficult for cryptocurrencies and companies to survive. In the midst of this, a Singapore-based company is looking to raise $100 million in funding to up its valuation to $1.5 billion funding. Matrixport, which is one of Asia's biggest crypto lenders, claims to have commitments worth $50 million from lead investors.
Whether or not the deal will go through is yet to be known since the crypto market is still fearing another contagion. FTX's collapse, which wiped out its native token FTT's value significantly, is still keeping the market subdued. Regardless, cryptocurrencies are recovering, including the likes of FTT itself.
FTT/USDT 1-day chart
The cryptocurrency noted a 12.65% increase in its value in the last four days. While this does not make any dent in the 95% drawdown the altcoin registered during November 6's crash, it still is a positive sign. This could even help the broader market in recovering, which is still struggling to breach the $800 billion mark and rise above it.
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