Genesis Trading, the trading subsidiary of crypto venture capital behemoth Digital Currency Group (DCG), is poised to halt its trading operations in the United States later this month. This move comes in the wake of DCG’s crypto lending arm, Genesis Global Holdco, filing for bankruptcy earlier this year.
According to reports by Bloomberg, a spokesperson representing Genesis Trading stated that the decision to wind down its U.S. trading services was taken for “business reasons” and was voluntary. They emphasized their ongoing cooperation with regulatory authorities to ensure a smooth discontinuation of services.
Previously, following the downfall of its lending arm earlier this year, DCG had publicly declared that its trading operations would persist in a “business as usual” manner. However, recent developments paint a different picture.
Genesis Trading communicated the closure plan to its clients via email on Tuesday, setting a deadline for all client trades to be settled by September 21. Any remaining open accounts will be officially closed on September 30, signaling the culmination of its trading activities in the United States.
Genesis Trading: From Crypto Trailblazer to Regulatory Crossroads
The history of Genesis Trading is intertwined with the cryptocurrency industry’s evolution. In 2013, the firm introduced the world’s first Bitcoin over-the-counter (OTC) trading desk, marking a pivotal moment in cryptocurrency trading. Over the years, it transformed into one of the industry’s largest entities, providing capital and credit products to some of the most notable digital asset projects, networks, and funds globally.
At its peak, Genesis Trading managed a staggering $116 billion in spot volume and held over $14 million in active loans while catering to more than 1,000 institutional clients. Notably, the firm was licensed by the New York Department of Financial Services (NYDFS), underscoring its commitment to regulatory compliance.
Genesis Trading’s decision to shutter its U.S. operations aligns with a broader trend in the crypto industry, as several firms, including Nexo and Bittrex, have recently exited the United States due to mounting regulatory pressures. This highlights the ongoing challenges that the crypto sector faces in navigating the intricate landscape of regulations and compliance in the United States.
As the cryptocurrency industry continues to evolve, the fate of Genesis Trading serves as a noteworthy indicator of the challenges and adjustments that market participants must navigate to thrive in this dynamic and rapidly changing space.
