3AC Bomb | News: Major lending and trading firm Genesis Trading loses hundreds of millions of dollars

The Digital Currency Group (DCG), a major cryptocurrency business conglomerate, may not be in a good mood recently. Its subsidiary, Grayscale Investments, failed in its application to convert GBTC into a spot ETF. Today, it was reported by its media outlet, CoinDesk, that insiders claimed another DCG subsidiary, the large lending and trading company Genesis Trading, suffered losses of hundreds of millions of dollars due to the exposure of 3AC and the cryptocurrency service provider Babel Finance. Another large institution also suffered heavy losses due to 3AC.

The Digital Currency Group (DCG), a large cryptocurrency business group, may be facing some challenges recently. Its subsidiary, Grayscale Investments, failed in its attempt to convert GBTC into a spot ETF. Today, news surfaced from another DCG subsidiary, the media outlet CoinDesk, indicating that a source claimed a significant loss at Genesis Trading, a large lending and trading company also under the DCG group, due to exposure from 3AC of Three Arrows Capital and the cryptocurrency service provider Babel Finance, amounting to hundreds of millions of dollars. Another major institution also suffered heavy losses due to 3AC.

Michael Moro, CEO of Genesis Trading, stated: "As we said on June 17, we have mitigated a significant loss from a large counterparty. The counterparty failed to meet the margin call requirements. We liquidated collateral, hedged the risk, and moved forward. Business is operating as usual, and we are meeting all client needs."

3/Genesis can confirm that we carefully and thoughtfully mitigated our losses with a large counterparty who failed to meet a margin call to us earlier this week. No client funds are impacted. We sold and/or hedged all of the liquid collateral on hand to minimize any downside.

— Michael Moro (@michaelmoro) June 17, 2022

According to a statement from Genesis Trading, it issued over $44.3 billion in loans in the first quarter of 2022. Regarding the loss of hundreds of millions of dollars, sources suggest that the parent company DCG has the capability to absorb this loss.

Reports indicate that the loss at Genesis Trading was disclosed in mid-June and further reported by CoinDesk, a media outlet under DCG, based on information from sources, implying a certain level of credibility.