Bybit CEO offers clarification on Genesis exposure, but community demands more

Genesis Global, a prominent crypto lender, Filed for Chapter 11 bankruptcy On January 20, Protection in New York became the latest company to declare bankruptcy following the collapse of FTX. However, the attention of the crypto community has shifted to other crypto firms that had exposure to the lending firm.

A report states that a total of nine crypto firms have diversified exposure to Genesis, including Germaine, Bybit, Van Eyck, Decentraland and a few others. Bybit CEO Ben Zhou quickly responded to the reports and clarified that Bybit had in fact exposed $150 million to the insolvent crypto lender through its investment arm Mirana.

Zou noted that Mirana managed only a fraction of Bybit’s assets and had collateral positions of about $120 million, which Mirana had already liquidated, out of an apparent exposure of $151 million. They also assured that client funds are segregated, and Bybit’s earning products are not used by Mirana.

While many appreciated the quick explanation from the co-founder, many others questioned the explanation further, especially regarding the company’s revenue products.

Related: Gemini and Genesis have been charged by the SEC with selling unregistered securities.

A user demand Full disclosure about earning products, and how the product is generated. Another user questioned their relationship with Mirana and whether they were working on a strategy similar to FTX/Alameda.

Others were also surprised by the timing of the revelation, as Genesis’ troubles had been well known for some months now, and his biggest creditor, e.g. Gemini, actively seeking action against Genesis’ parent company, Digital Currency Group A user wrote,

“Tweeting ‘full disclosure’ only when your pants are caught automatically disproves your claim. If it was ‘full disclosure’ ByBit would have said it months ago.

Many others asked for proof of transactions between Baybat and Marina for reassurance. Reminder Similar statements have been made by FTX executives in the past.

Cointelegraph reached out to Bybit to get some clarification on its monetization program and field some community questions, but did not receive a response at press time.