A Winklevoss-run crypto operation has frozen $700 million in client withdrawals as it becomes ensnared in the FTX disaster
- Gemini, a cryptocurrency platform run by the Winklevoss brothers, halted client withdrawals for its Earn progam.
- Bloomberg reported Thursday that the Gemini Earn has $700 million in client funds.
The collapse of Sam Bankman-Fried's FTX is continuing to send repercussions through the crypto sector, with Genesis Global Capital and Gemini Earn announcing suspensions of customer withdrawals.
Gemini, a cryptocurrency platform run by the Winklevoss brothers, made its announcement Wednesday. Then, on Thursday, Bloomberg reported that the Gemini Earn product has $700 million in customer funds.
"We are aware that Genesis Global Capital, LLC (Genesis) — the lending partner of the Earn program — has paused withdrawals and will not be able to meet customer redemptions within the service-level agreement (SLA) of 5 business days," Gemini said in a blog post Wednesday. "We are working with the Genesis team to help customers redeem their funds from the Earn program as quickly as possible. We will provide more information in the coming days."
The Gemini Earn program lets users lend their crypto to institutional borrowers.
The company also stated that the decision does not impact any other Gemini products and services, and that all customer funds kept on the Gemini exchange are held 1:1, and available for withdrawal at any time.
Meanwhile, Genesis Global Capital, which is the crypto-lending arm of Genesis Global Trading, cited "the extreme market dislocation and loss of industry confidence caused by the FTX implosion," according to CoinDesk.
Genesis Global Trading is capitalized separately and continues to provide full trading and custody services.
Last week, Genesis revealed that its derivatives unit had $175 million in its FTX trading account, prompting owner Digital Currency Group to provide an equity infusion of $140 million.
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