Stablecoin issuer Tether USDT/USD said on Wednesday that it had no exposure to institutional cryptocurrency lender Genesis or the Gemini Earn program, which have halted withdrawals.
What Happened: The lending division of crypto investment bank Genesis Global Trading temporarily stopped withdrawals on Wednesday, raising speculations that USDT had significant exposure to Gemini.
This comes as a cascading effect of the FTX FTT/USD collapse, with major crypto companies filing for bankruptcy and halting withdrawals. Tether is the operator of the USDT token, the largest stablecoin that is pegged to the dollar.
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“Tether tokens are 100% backed by its reserves, and the assets that are backing the reserves exceed the liabilities,” Tether said in a statement. The company said it holds a strong, “conservative, and liquid portfolio, which includes cash, cash equivalents, and U.S. treasuries.”
Genesis Global Capital caters to institutional clients. It had $2.8 billion in total active loans at the end of the third quarter of 2022. Its interim CEO told customers that Genesis was looking into options for the lending unit, including locating a new source of financing.
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