Bitcoin miner Genesis Digital among largest assets in FTX bankruptcy

Sam Bankman-Fried's trading firm Alameda Research was said to have poured in some $1B into bitcoin ( BTC-USD ) miner Genesis Digital Assets before the start of last year's bear market, marking it one of the largest assets in the bankruptcy of his cryptocurrency exchange, FTX ( FTT-USD ). The problem with that outsized bet is valuations across bitcoin-mining firms have deteriorated significantly over the course of the market downturn, due to a combination of depressed BTC prices, elevated energy/electricity prices and a high network hash rate. That said, it could be tough to recover value from Cyprus-registered Genesis Digital, as only around half of the funds from Alameda to Genesis Digital went to the miner's operations, The Wall Street Journal noted, citing corporate-registration documents and people familiar with the firm. And over $500M bought existing shares from two co-founders of Genesis Digital. The miner, which is owned by most of the its founders, received funds from Alameda, the crypto hedge fund in which Bankman-Fried owned a majority stake, "at market value," a spokeswoman for Genesis Digital, which labeled itself as a low-cost bitcoin ( BTC-USD ) miner, told the newspaper. On November 10, 2022, just a day before FTX and its over 130 affiliates filed for Chapter 11 protection, Bankman-Fried resigned from Genesis Digital's board after joining it in October 2021, the people said. After Bankman-Fried's empire imploded late last year, FTX's new management has since been unwinding the business in an effort to repay its creditors that face losing billions of dollars. Earlier, FTX advisers secured over $5B worth of cash, sellable crypto and liquid investment securities .