Bybit's $151M Exposure To Bankrupt Genesis

You think you are safe because you do not have any exposure to a centralized crypto-related platform that went out of business and filed for bankruptcy. It reveals one by one how each and every centralized crypto platform are connected with each other. Maybe you do not have any direct exposure, but you can have indirect exposure to it.

Bybit founder Ben Zhao addresses concerns about having exposure to bankrupt crypto lender Genesis. If you do trading in Bybit or do anything over there, it is worth paying attention to what's going on before it is too late.

Mirana is an investment unit of the centralized crypto exchange Bybit that has exposure worth $151 million to the bankrupt crypto lender Genesis Global Capital. Bybit founder informed in a tweet that they have almost $120 million of collateralized positions which Mirana already liquidated.

It is stated that they keep clients' funds separate. Mirana deals with some assets of Bybit. They have earn product that does not use Mirana. When any centralized crypto exchange or platform offers earn program, they are generating profit from somewhere that is distributed to the users who get involved with that.

It should be clear how they generate income from the different offers they make. Now people who use Gemini earn program are in trouble and their crypto assets are locked. After filing Genesis bankruptcy, it is expected that users will get their funds. But when users will get their funds back, I think no one can answer that. It usually takes a long time.

It would be better if Bybit provides full details about how they generate yield on their earn products. People react differently knowing Bybit exposure to bankrupt Genesis. It started with Terra LUNA, then Three Arrows Capital, FTX, and now Genesis.

You can see more green candles in the crypto market for a couple of days and the BTC price hit 23k. At the same time, you cannot ignore what's going on in Genesis and how it will impact its parent company Digital Currency Group (DCG).

Whatever happens, it is clear that you cannot trust centralized crypto platforms. They are way more related to each other than you think. Due to direct or indirect exposure, there is a high chance you will be affected. The less exposure you have on centralized crypto platforms, the better.

So what do you think? Please feel free to leave your comments. Thank you for reading this post. That's it for now. I'll be back with another post.

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