From Genesis to Voyager, crypto firms’ exposure to FTX is coming to light

After major crypto exchange FTX filed for U.S. bankruptcy protection on Friday, the crypto industry is bracing for further fallout.

BlockFi and Genesis, two firms with exposure to FTX or its affiliated crypto trading firm Alameda Research, have suspended customer withdrawals as the market unpacks the extent of FTX’s reach.

Other crypto firms may be exposed to FTX by having held tokens on the exchange or by owning FTX’s native token, FTT, which plunged around 94 percent last week.

Some of FTX’s investors have said they are writing their investment down to zero.

While the extent of the contagion across crypto markets remains unclear, here are some firms that have given information about their exposure to FTX.

Genesis

The crypto lending arm of U.S. digital asset broker Genesis Trading suspended customer redemptions on Wednesday, citing the sudden failure of FTX.

Venture capital firm Digital Currency Group, the ultimate parent of Genesis, as well as of crypto asset manager Grayscale, said on Twitter that Genesis’ decision to suspend redemptions “was made in response to the extreme market dislocation and loss of industry confidence caused by the FTX implosion.”

Genesis, which had $2.8 billion in total active loans at the end of the third quarter according to the company’s website, said in a tweet on Nov. 10 that its derivatives business has about $175 million in locked funds on FTX.

“Genesis has no material exposure to FTT or any other tokens issued by centralized exchanges,” the firm said in a tweet on Nov. 9.

BlockFi

Crypto lender BlockFi said on Nov. 11 it was pausing client withdrawals until there was clarity on FTX. The crypto exchange had signed a deal with an option to buy BlockFi for up to $240 million, BlockFi said in July.

Binance

Binance Chief Executive Changpeng Zhao sparked concerns among investors on Nov. 6 when he said in a tweet that the crypto exchange would sell its holdings of FTT.

Zhao told a Twitter spaces event on Monday that Binance had previously held $580 million worth of FTT, of which “we only sold quite a small portion, we still hold a large bag.”

Celsius Network

Bankrupt crypto lender Celsius Network said in a tweet on Nov. 11 that it had 3.5 million Serum tokens (SRM) on FTX as well as around $13 million in loans to FTX-linked trading company Alameda Research. The loans were under-collateralised, mostly by FTT tokens, Celsius said.

Coinbase

Coinbase Global Inc said in a blog post on Nov. 8 that it had $15 million worth of deposits on FTX. It said it had no exposure to FTT, no exposure to Alameda Research and no loans to FTX.

It said it had $5 billion in cash and cash equivalents at the end of Q3.

Coinshares

Crypto asset manager CoinShares has $30.3 million worth of exposure to crypto exchange FTX, CoinShares said in a statement on Nov. 10.

CoinShares CEO Jean-Marie Mognetti said the group’s financial health remains “strong,” adding that its net asset value at the end of Q3 was 240.6 million pounds ($282.51 million).

Crypto.com

Singapore-based crypto exchange Crypto.com said on Nov. 14 it had moved about $1 billion to FTX over the course of a year, but most of it was recovered and exposure at the time of FTX’s collapse was less than $10 million.

CEO Kris Marszalek said the firm would prove wrong all naysayers who thought the platform was in trouble, adding it had a robust balance sheet and took no risks.

Galaxy Digital

Crypto financial services company Galaxy Digital Holdings Ltd said in its third-quarter earnings statement on Nov. 9 – the day after FTX froze withdrawals – that it had $76.8 million worth of exposure to FTX, of which $47.5 million was “in the withdrawal process”.

In the earnings call, CEO Mike Novogratz said Galaxy had more than $1 billion in cash and $1.5 billion in liquidity.

Galois Capital

Hedge fund Galois Capital had half its assets trapped on FTX, co-founder Kevin Zhou told investors in a recent letter, the Financial Times reported, estimating the amount to be around $100 million.

Galois did not respond to requests for comment by Reuters.

Kraken

Cryptocurrency exchange Kraken said on Nov. 10 that it held about 9,000 FTT tokens on the FTX exchange and was not affected “in any material way”.

Kraken also said on Sunday it had frozen the accounts of FTX, Alameda Research and their executives.

Silvergate Capital Corp

Silvergate Capital Corp said on Nov. 11 FTX represented less than 10 percent of $11.9 billion deposits from all digital asset customers as of Sept. 30.

The financial solutions provider to digital assets also said Silvergate has no outstanding loans or investments in FTX, and that FTX is not a custodian for Silvergate’s bitcoin-collateralized Silvergate Exchange Network (SEN) leverage loans.

Voyager Digital

FTX won crypto lender Voyager Digital’s assets in a $1.42 billion bid at an auction in September, months after the lender spurned an earlier proposal and called it a “low-ball bid dressed up as a white knight rescue.”

Voyager Digital Ltd said on Nov. 11 it had reopened the bidding process for the company and maintained a balance of approximately $3 million at FTX when the crypto exchange filed for protection from creditors.

Grayscale

Crypto asset manager Grayscale, whose flagship Grayscale Bitcoin Trust (GBTC) is the world’s largest bitcoin fund, told investors on Wednesday that the recent market events have had no impact on its product operations or the security of the holdings in its funds.

Still, the price of GBTC plunged almost 7% on Wednesday. Digital Currency Group is the parent company of both Genesis and Grayscale, and of other crypto-related companies.

($1 = 0.8516 pound)