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FTX contagion in Korea: GOPAX halts Genesis-backed DeFi

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South Korean crypto exchange GOPAX has halted withdrawal of principal and interest payments in its decentralized finance (DeFi) service GOFi, which brokers products from global crypto lender Genesis Global Capital, LLC., the exchange announced on Thursday in Asia.

See related article: New FTX chief says lack of controls at bankrupt exchange ‘unprecedented’ 

Fast facts

  • The suspension of fund withdrawal and interest payments at crypto savings product GOFi is ongoing, GOPAX confirmed with Forkast Friday morning in Asia.
  • The suspension at GOFi is prompted by partner Genesis Global Capital, which halted redemptions and new loan originations at lending arm Genesis Global Trading, GOPAX said in its announcement.
  • Genesis Global Capital announced the suspension on Wednesday, citing “abnormal withdrawal requests” following the public collapse of FTX last week. Recent reports say the global crypto lender is seeking a US$1 billion emergency loan by Monday. 
  • GOPAX said it had requested Genesis to return all GOPAX user assets before Genesis made the announcement but has not received the repayment, for which the exchange says it is communicating with Genesis and its mother company, Digital Currency Group (DCG).
  • Digital Currency Group is the second-largest shareholder of GOPAX.
  • GOPAX has told users that the suspension is only pertinent to its DeFi service, and that the assets deposited in GOFi are stored separately from user assets deposited in the trading platform.

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