Hong Kong’s leading crypto operator Genesis Block ceases trading as FTX fallout roils sector

https://www.reuters.com/technology/hong-kongs-leading-crypto-retail-operator-says-it-ceases-trading-ftx-fallout-2022-11-18/

Genesis Block, a leading cryptocurrency retail service provider in Hong Kong said it had ceased trading as the broader fallout from the collapse of FTX and solvency issues at other major crypto firms continue to roil the sector.

Genesis Block, which once operated one of Asia’s most extensive bitcoin ATM networks, said it would be closing down its over-the-counter trading portal on Dec 10, according to an email to customers by its compliance department reviewed by Reuters.

“We have ceased trading, as we don’t know which counterparties would fail next, so we would rather close out all our positions to regain some of our liquidity,” chief executive Wincent Hung told Reuters this week.

The email shows that the company is asking customers to withdraw their funds and will not accept new customers.

Genesis Block has no connection with a separate crypto player called Genesis Global Capital, which suspended customer redemptions this week.

Even before FTX’s bankruptcy, Genesis Block had been winding down its Hong Kong business, according to three people familiar with the situation, cutting ties with the failed exchange earlier this month.

One person with knowledge of the matter said one Genesis Block official was previously a director in FTX Hong Kong but resigned from the directorship this month. FTX Hong Kong is one of the 130 FTX-affiliated companies backed by Sam Bankman-Fried that have filed Chapter 11 bankruptcy proceedings in the United States.

The people declined to be identified because they were not authorized to speak to the press.

Genesis Block executives declined to comment.

Genesis Block’s website still shows a guide to how to buy FTT, the native token of the failed exchange, using the ATM network, which spans 29 locations in Hong Kong and six in Taiwan.

The ATMs are now operated by a brand called CoinHero, which is expanding in Hong Kong after Genesis Block sold the business to a third party last year, according to the people who know the matter.

 

In Hong Kong’s busy Causeway Bay shopping district, cryptocurrencies bitcoin, tether, and dogecoin can be traded easily at ATMs and trading desks.

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