Is the Bitcoin price diving again?
Major US crypto exchange on the brink of collapse
The American crypto trading platform Genesis has filed for bankruptcy. The first hearing in court will take place on Monday. The Bitcoin course is unimpressed and continues to rise. Why it is like that.
Published: 9 minutes ago
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Genesis is one of the largest crypto trading platforms in the USA.
The bitcoin price goes up and up. In the current year, the price of the world’s largest digital currency has climbed by over 37 percent – from 15,000 to currently over 21,000 francs. Most other cryptocurrencies are also on a recovery course, but this could now be stopped abruptly.
Because the case of Genesis shocked the industry at the end of last week: The large American crypto exchange filed for bankruptcy on Friday. Specifically, the Chapter 11 reorganization proceedings in US law affect the company’s lending division. Recently, Genesis was no longer able to raise the necessary liquidity to meet the existing demands of the lenders.
Fear after FTX scandal
The Bitcoin price was not directly affected by this news. The company announced that it would continue to operate as a trading platform and that customers would still have access to their money. According to Genesis, it currently has over $150 million in cash to fund its operations.
That reassured investors for the time being. But the insolvency proceedings remain the topic of conversation in the industry at the beginning of the new week. The fear that more major crypto exchanges could fall after the FTX scandal remains acute. Rumors have persisted for weeks that “Crypto.com” and “Binance” – the largest crypto trading platform in the world – are also in trouble.
Debt burden of $3.5 billion
The development of the Bitcoin course is remarkable under these circumstances. Investors in digital currencies are currently looking at the stock market, which has risen due to good inflation data from the USA. The hope that the economic outlook will brighten in the summer and that central bank interest rate hikes will come to an end at the end of 2023 outweighs concerns about further crypto bankruptcies.
The first court hearing on the bankruptcy of Genesis in America will take place today, Monday. According to a report by the Reuters news agency, the court documents show that the US crypto exchange wants to complete the bankruptcy proceedings as quickly as possible. According to the documents, the company has a debt load of about $3.5 billion. (no)