Gemini Exchange has paused withdrawals from its lending partner Genesis due to pausing redemptions during a difficult past week. The fiasco has led to Gemini possibly being insolvent. The markets are down with Bitcoin down 2%. However, some people are shorting Bitcoin while others believe the best strategy is to spot buy and scale in for the long term. Meanwhile, digital currency group, Gemini’s initial investor, has given an inflow of $140 million, but withdrawals are still paused leading many to speculate on the future of the exchange.
Gemini Halts Withdrawals: Should You Be Worried?
Welcome to Around the Blockchain where today we’re discussing the recent news of Gemini halting withdrawals, which has caused concern in the crypto community. We’ll also be diving into FTX shorted coins and FTX being investigated, making for a packed episode with a fantastic lineup.
In the top right corner, we have the man himself, Mind Your Biz, known for his top-quality content on security, mining, and all things crypto-related. On the bottom right, we have That Martini Guy, who may have once been known as the “martini guy” but will always be the “Martini guy” to us. In the bottom left corner, we have Altcoin Daily representing the West Coast with his belief that it’s the best coast. And finally, in the top left corner, we have Hotep Jesus, known for his insightful and thought-provoking commentary on the crypto market.
Gemini’s current situation has caused concern in the crypto market as they have pause withdrawals, causing a domino effect on the already down market. Despite Bitcoin being down two percent, some traders still see it as a good opportunity to buy while others fear another leg down, ultimately leading to the possibility of Bitcoin reaching a low of $14k.
The recent tweet from Gemini’s official Twitter account confirms that their lending partner, Genesis, has paused withdrawals and may not be able to meet customer redemptions within their agreed-upon five-day timeframe. Digital currency group, an initial investor in Genesis, has given them an influx of $140 million, but withdrawals are still paused.
The news has sparked debate on whether this is the end of the road for Genesis, leading to a possible shutdown, or whether there is potential for them to rebound from this situation. As self-custody remains the safest option, it’s important to consider one’s personal risk tolerance before choosing to keep funds on an exchange like Gemini.
Overall, this situation serves as a reminder that even exchanges considered to be more trustworthy, such as Gemini and Coinbase, carry potential risks. However, it’s crucial to recognize that this event is ultimately a healthy one for the crypto space as it will deter exchanges from borrowing against their users’ funds in the future, ultimately leading to a safer and more robust market.