Genesis Trading CEO Michael Moro on Wednesday said Three Arrows Capital (3AC) was the large counterparty that failed to meet a large margin call in June, forcing liquidation of the related collateral.
Since then, said Moro, Genesis has worked with parent Digital Currency Group (DCG) to continue to isolate risk, with DCG also assuming certain liabilities of Genesis related to troubled hedge fund 3AC. DCG is also the owner of CoinDesk.
CoinDesk last week reported Genesis was facing hundreds of millions of dollars in losses thanks in part to its exposure to 3AC, and also noted the deep pockets of parent DCG as likely to help ease the blow.
Though providing no detail on the amount of the losses, Moro said Wednesday the loans to 3AC had a weighted average margin requirement of 80%. Once that level was breached and no additional margin posted, Genesis sold the collateral and hedged further downside.
Read more about
DISCLOSURE
Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
