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Bybit suspends USD bank transfers amid service outages

by Blockchain NewsMarch 5, 2023

Bybit, a Dubai-based cryptocurrency exchange, has announced that it is temporarily suspending United States dollar (USD) deposits via bank transfers in response to “service outages from a partner.” According to a blog post from March 4, USD deposits via wire transfer are no longer available, but users can still make USD deposits through the Advcash Wallet or with a credit card. Withdrawals through the Advcash Wallet are scheduled to be available soon, according to the exchange.

Bybit has reassured users that their funds are safe and secure, but is urging clients planning to withdraw USD to do so “as soon as possible to avoid potential disruptions.” The halt comes just a day after Silvergate Bank announced plans to discontinue its digital assets’ payment network, which was one of the major on- and off-ramps for USD in the American crypto industry.

Bybit is one of the companies with exposure to the crypto lender Genesis Global Trading, which filed for Chapter 11 bankruptcy on Jan. 20. According to Bybit CEO Ben Zhou, the exposure amounts to $150 million via its investment arm Mirana Asset Management. A total of $120 million of the funds were collateralized and had already been liquidated, according to Zhou. He also assured that all client funds go into separate accounts and that Bybit’s earn products do not use Mirana.

The regulatory pressure and market outflows following the dramatic collapse of the cryptocurrency exchange FTX in November 2022 are driving US banks to reduce their exposure to cryptocurrency assets. Last month, Binance announced that it would temporarily suspend bank transfers of US dollars. In January, the exchange also said that its SWIFT transfer partner, Signature Bank, would only process trades by users with USD bank accounts over $100,000. Signature Bank previously announced that it was drastically decreasing crypto deposits.

While Bybit has suspended USD deposits via bank transfer, users can still make deposits through the Advcash Wallet or with a credit card. Bybit has assured users that their funds are safe and secure, but is urging clients to withdraw USD as soon as possible to avoid potential disruptions. The halt comes amid regulatory pressure and market outflows in the wake of the collapse of FTX and the bankruptcy of Genesis Global Trading.

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Genesis Global Trading’s Q1 Report Shows Growth In Bitcoin Markets

by Bitcoin MagazineMay 3, 2021

On April 28, Genesis Global Trading, Inc., a subsidiary of Digital Currency Group, released its digital assets report for the first quarter of 2021. Genesis provides institutional clients with spot and derivatives trading, lending, custody and treasury and prime brokerage service products, so the report was full of interesting insights that showed the explosive growth in the bitcoin lending market that has taken place so far this year.

Growth In Bitcoin Lending

According to the report, Genesis saw:

$60 billion in trades, loans and transactions for digital assets over the first quarter

Over $20 billion in new loan originations, a $12.4 billion increase from Q4 2020.

Active loans outstanding increased to $9 billion, up 136.4% from $3.8 billion in Q4 2020.

Genesis Global Trading’s Q1 report demonstrates significant growth in the bitcoin lending, spot trading and derivatives markets.

At the conclusion of the quarter, BTC made up 42.8% of Genesis’ loan portfolio, a decrease from 53.9% quarter over quarter. It cited one of the reasons for the decline in loans extended in bitcoin was the GBTC discount to net asset value (NAV) that first developed in January.

With the GBTC premium negative, demand to borrow BTC to execute arbitrage trades to generate “risk free” yield greatly decline.

Through the first quarter, the spread between bitcoin futures and spot price continued to widen as more demand to be leveraged increased throughout the bitcoin market. The widening basis and increasingly liquid bitcoin futures and derivatives market continues to drive more institutional capital to the market.

“This persistence in basis premium has led many more institutions to eye crypto yield opportunities, driving our cash portfolio’s continued growth. As the June basis continued to widen into the end of the quarter, our derivatives desk saw increasing demand from macro discretionary firms and arb shops to put on the basis / cash-and-carry trade through our desk.

Some key advantages for trading the basis in a bilateral OTC format include physical settlement of the forward and collateralizing the forward with the underlying crypto asset. In many ways, the persistence of basis is a cash-deficit issue within crypto market structure.” –Genesis’ “Q1 Market Observations”

Spot Trading

Genesis also reported on its digital assets spot trading volume, which witnessed explosive growth in Q1, trading $31.5 billion in spot,, an increase of 287% from Q4 2020, aided by the launch of Genesis Treasury. Corporates increased to 27.06% of total OTC volume, up from 0.49% of total volume last quarter.

Derivatives

According to the report, Genesis saw:

133% growth from Q4 across OTC and negotiated derivative blocks to reach $10.5 billion in trading volume.

Counterparty base growth of 21% over the course of the quarter.

According to the report, the majority of this flow came from:

“HNW individuals and systematic yield funds taking advantage of higher implied vols and the spot rally to lighten up on length via call overwriting.

Recycling risk in medium- to long-dated calls between overwriters and counterparties looking to add length in a levered but limited loss format. (The relative implied funding cost of perpetual swaps vs. longer-dated futures sometimes made buying longer-dated calls a more attractive option.)

Corporate accounts and venture books using puts to hedge their business risk or illiquid portfolio risk.

Selective hedging of impermanent loss via short-dated gamma portfolios”

The numbers and growth reported by Genesis are extremely bullish, and show the continued maturation in the bitcoin lending, futures and derivatives markets, as sophisticated institutional capital allocators are incentivized to enter the market due to the contrasting yields offered across the legacy versus the bitcoin futures/derivatives markets.

At the time of the report, the aggregate open interest across the bitcoin futures markets is sitting at $18.9 billion, up from $2.9 billion from a year ago. The demand to be leveraged long on BTC is a major reason that yields in the bitcoin ecosystem are so large, and this in turn drives additional capital inflows and interest in the bitcoin markets.

Expect Genesis’ growth to continue to increase exponentially over the coming quarters and for large players from the legacy system to scramble to get exposure and get involved.

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Tagged : All News / Bitcoin / Derivatives / Genesis Global Trading / Lending / Markets / Spot Trading

Genesis spot volume up 287% in Q1, corporate treasury service takes off

by CointelegraphApril 29, 2021

Leading full-service cryptocurrency prime broker Genesis Global Trading has seen spot trading treble in the first quarter.

Corporate interest accounted for the biggest slice of trading, with Genesis attributing part of its success to its Bitcoin treasury product “Genesis Treasury”.

The Q1 report released on April 28 revealed the firm had processed $31.5 billion in spot trading volume — a 287% increase from $8 billion in Q4 2020. It also saw $10.5 billion in derivatives trading.

Corporates accounted for $8 billion of the total spot trading volume, an increase of 25% from the previous quarter. The growth of corporate trading to account for the largest share was a significant shift from the passive funds and hedge funds that formerly dominated trading in Q4.

“Much of this surge was attributable to a mix of clients taking positions in Bitcoin for the first time, existing clients adding to their positions, and clients choosing to take a more active approach to manage their exposure.” Genesis wrote.

The crypto broker noted that “numbers were bolstered” due in part to the launch of Genesis Treasury — a service designed for corporates to gain exposure to Bitcoin through accumulation strategies such as equity, liquidity, and yielding returns. The firm noted interest in the Genesis Treasury followed the broader level of interest from large institutions entering crypto markets such as Tesla and MicroStrategy:

“As corporate clients began buying Bitcoin for their treasuries in Q1, our ratios shifted. The entrance of companies like Tesla, MicroStrategy and Square led to a wave of interest from corporates looking to work together with Genesis Treasury for their own treasury allocation efforts.”

Genesis also posted strong increases in crypto lending in Q1, adding over $20B in new originations, compared to $7.6B originated in Q4, with active loans outstanding increasing to $9B, up 136.4% from $3.8B at the end of 2020.

Cumulative originations increased 94.8% bringing the total up to $40B in originations since the launch of its lending services in March 2018.

“Our loan portfolio increased substantially in value through a combination of new issuance across cash, ETH, and Decentralized Finance (DeFi) assets alongside a significant rise in asset prices across our existing crypto book,” Genesis wrote.