Genesis Trading, which is currently in bankruptcy proceedings, has moved 40,000 ETH, or $126.8 million, into two separate portfolios, foreshadowing a possible liquidation as part of the bankruptcy.
According to Arkham Intelligence data, a cryptocurrency wallet affiliated with Genesis Trading sent 27,500 ETH to an address starting with 0xcbCF. The value of the transfers was about $87.09 million. At the same time, a wallet affiliated with Genesis also sent 12,500 ETH to another address starting with 0x72FE, with a value of $39.59 million. The transfers took place early in the morning in Asia on Friday.
This came two days after the Genesis cryptocurrency wallet transferred the amount of 9644.4 ETH, which is about $31.61 million, on July 31. The Genesis Trading wallet transferred more than 12,600 Bitcoin (BTC) worth about $719.9 million between June and July, mostly in transactions of 500 to 700 BTC.
Genesis’ transfers are aimed at minimizing losses for defrauded investors
The massive Bitcoin and Ethereum transfers follow a settlement that Genesis reached with the state of New York in May. Under the settlement, Genesis is obligated to pay $2 billion to investors defrauded through its Earn program .
The $2 billion settlement is apparently the largest settlement against a cryptocurrency company in New York State history. As a result, the New York State Attorney General also noted that he plans to increase oversight and regulation of the digital asset industry, which has so far secured more than $2.5 billion from cryptocurrency platforms.
Genesis has succumbed to a lawsuit accusing the company of defrauding 230,000 investors, including New York residents, through its Earn program. Apparently, the company failed to disclose the risks associated with the Earn program.
The lawsuit was filed against Genesis, Digital Currency Group, its CEO Barry Silbert and former Genesis CEO Soichiro Moro.
In addition, the New York Attorney General’s office has also filed a lawsuit against former Celsius CEO Alex Mashinsky for allegedly covering up the platform’s “terrible financial situation.”
Mashinsky now faces criminal charges related to securities fraud, telecommunications fraud and conspiracy to commit fraud. His trial is scheduled to begin in January 2025.
