Cryptocurrency lending platform Genesis has informed its clients that the withdrawal freeze is likely to continue for a few more weeks, as the company works to develop a plan of action that could potentially help save it from a possible bankruptcy filing.
In a letter sent out to customers on Dec. 7 and seen by Cointelegraph, interim CEO Derar Islim, who was appointed in August, said that it may take a few extra weeks to be able to come up with a plan of action that would enable withdrawals from the platform to be resumed.
“At this point, we anticipate that it will take us additional weeks rather than days to come up with a way forward.”
The letter also mentioned that Genesis is being assisted by experienced advisors as it looks to find a way to protect its clients’ assets, improve liquidity and put the company’s operations back on track.
“All other Genesis entities remain fully operational,” it added.
Related: Crypto Lender Genesis Allegedly Owes $900M To Gemini Clients: Report
The first hints of trouble at Genesis came to light in November, when FTX revealed that the company had over $175 million in funds. DCG, the parent company of Genesis, attempted to rescue the situation by injecting $140 million into the platform, but it turned out that this was not sufficient to solve the liquidity problems.
On Nov. 16, Genesis froze all withdrawals, citing “unprecedented market turmoil” following the FTX collapse and “abnormal” withdrawal requests that had exceeded their liquidity.
On Nov. 21, it was reported that Genesis was facing bankruptcy, with the company unable to cover a balance sheet deficit of $1 billion. However, the crypto lender rejected the claims and announced that it had retained an investment bank, Moelis & Co, to provide restructuring services and avert the need for Chapter 11.
In the letter, Genesis once again stated its commitment to being as transparent as possible with affected customers and assured them that they will be kept updated on any significant developments.