By Michael Scott
The crypto community questioned the timing of Bybit’s chief executive revealing exposure to Genesis. The community challenged Bybit’s chief executive to prove the reassurance.
The latest development comes hours after Genesis Global confirmed filing chapter 11 protection on January 20 before the New York bankruptcy court. The move by the crypto lender places it among the digital asset companies declaring bankruptcy following the calamitous FTX downfall.
Nonetheless, the crypto community focus is shifting to other firms reportedly concealing their exposure to the lender. The community is attracted to nine firms alleged to have varying exposures to the bankrupt lender, including Bybit, Decentraland, Gemini, and VanEck, among others.
Bybit Admits $150 Million Exposure
Bybit chief executive Ben Zhou countered the speculations by admitting $150 million exposure to the now defunct crypto lender through the investment affiliate Mirana.
Zhou observed that Mirana was only managing Bybit’s crypto assets. He added that the $151 million exposure features a $120 collateral position that Marina liquidated. The official reassured the separation of users’ funds while the earn products do not utilize Marina.
The quick clarification attracted a mixed bag of reactions. Although a substantial number appreciated Bybit’s co-founder update, others wondered if the details of the firm’s earn products.
A disgruntled client challenged the chief executive to make a detailed disclosure of the ear programs and the mechanism of generating user gains. Another individual required Zhou to clarify the Bybit-Mirana business relationship. He wondered whether the two replicated the operating strategy deployed by FTX and Alameda Research.
Timing of Bybit’s Exposure Questioned
The timing of Zhou’s revelation when Genesis laid bare its challenges through the bankruptcy filing is dishonest. One user decried Bybit’s silence when the financial crisis confronting Genesis had been known for months.
The user echoed the criticism of Zhou since Genesis’ challenges were illustrated by Gemini’s Winklevoss in his pursuit of $900 million refunds from Digital Currency Group following the termination of the Earn program.
The users wonder why Zhou only made a late disclosure when Genesis filed for bankruptcy. They regretted the delay, thereby portraying the present disclosure as dishonest.
The delay prompts the community to challenge Zhou to disclose proof of Bybit-Marina transactions since Sam Bankman-Fried and other executives made similar statements about FTX links to Alameda Research.
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