THE CONTINUED UNRAVELLING OF FTX NOW ENGULFS GENESIS

Just this last Monday I blogged about a story shared by L.G.L.R. concerning the collapse of the FTX crypto-"currency". In that blog I pointed out the problems mentioned by the current acting CEO of FTX, that the company apparently kept virtually no records; it was, as he put it, a "paperless bankruptcy". As I pointed out, I thought this to be a tremendously problematic admission. After all, the whole point of crypto-"currencies" is supposedly their relative "unhackability:, and the relatively "secure" nature of the blockchain technology and its "distributed ledger" &c &c. Wasn't the whole point to be paperless yet to have some records? And now the records are gone?

So as I put it in my Monday blog, it seems that FTX either kept no records  at all, and merely used the idea of crypto-"currencies" but used none of its standard features, or somehow even its cyber-records disappeared, which would seem to require some very high and knowledgeable players to make that possible. On top of all of this, these revelations occurred in an article alleging that FTX was hacked to the tune of $477,000,000. Where did that knowledge come from? Who had a record of that, and what kind of record was it, digital? or actual hard copy?

Well, now you can add more to the story, according to this article shared  by V.T.:

Crypto giant Genesis is 'days away' from bankruptcy after suffering steep losses in wake of FTX collapse: Firm owes creditors $3 BILLION - including $900M to Winklevoss twins

There's an unpleasant fish-market odor hanging over this story too. Ponder this for a moment:

Popular cryptocurrency broker Genesis is expected to file for bankruptcy within days, insiders have revealed.

It would make the firm the latest crypto casualty following the spectacular downfall of Sam Bankman-Fried’s FTX, where the company held some of its funds.

According to people familiar with the matter, Genesis is currently in the final stage of its Chapter 11 paperwork as it works toward a deal with creditors.

The company, which is owned by venture capital firm Digital Currency Group, had been considering filing for bankruptcy for some time, as it reportedly owes creditors more than $3billion.

Among those owed money is Gemini, owned by Cameron and Tyler Winklevoss, which reportedly saw more than $900million of its customers' funds evaporate from the exchange after Bankman-Fried's own Chapter 11 filing in November.

Cameron and his brother's exchange used Genesis as its main lending partner, leaving the brothers - and millions of their customers - in the red as a result.

Lenders like Genesis, founded by crypto magnate Barry Silbert, suffered steep losses from loans it supplied FTX's now-defunct trading firm Alameda Research and its hedge fund backer Three Arrows Capital, both of which filed for bankruptcy.

A new report published Wednesday by Bloomberg revealed that as figures such as Winklevosses seek to recover sums lent to Genesis, the New York based-lender has resigned that it cannot raise the funds to pay back its creditors.

The article goes on from there to detail the dealings between Genesis and other crypto-"currency" asset management and investment firms, which, while intriguing for the vast sums of money involved, are beyond the scope of what grabbed my attention about the above statements in the context of my blog on Monday, for again, the philosophical question raised b y FTX's poor record-keeping is raised here, but in a much more subtle way:

If FTX kept such bad records, how do we know how much Genesis "loaned" to FTX?  The answer is simple: because Genesis kept records, and these records now represent a claim on FTX.  But who is to say those records are accurate  and, so to speak, "unhacked"? In the alleged absence of records on the part of FTX, what is to prevent claims simply being invented and, for that matter, the loans themselves from being "hacked" and erased or, absent that, "adjusted"?

In short, we appear to be looking at a situation in which so many firms and "crypto-'currencies'" are so interlocked and interconnected, and with records of at least a  suspicious and dubious nature, that the complexity of the interlock may dwarf even the bankruptcy of I.G. Farben (which, let us recall, only finally and formally ended in 2003!) Is the interlock so pervasive and extensive that what we're looking at is not only a massive money-laundering operation but also a massive theft and asset seizure operation?  If FTX just the tip of the iceberg and the cusp of a story that is only just beginning?

I suspect that that is indeed the case.

And this, let us remember, is the system Mr. Globalooney and his central banks want us to embrace with their central bank digital currencies?

Sorry, guys, but I'm not impressed.

See you on the flip side...