The French cryptobank Coinhouse is suspending withdrawals relating to its offer of crypto passbooks offering up to 6% annual returns. A binding decision stemming from Coinhouse’s exposure to Genesis Trading, a company itself exposed to FTX and which also suspended withdrawals due to tied up cash.
Coinhouse in the fog
Coinhousethe French cryptobank notably known for being the first to benefit from registration as a digital asset service provider (PSAN), today announced that its customers who have subscribed to its crypto passbook offer will no longer be able to withdraw their funds.
We informed customers yesterday of @CoinhouseHQ having invested in Crypto Passbooks from the temporary suspension of withdrawals.
—Coinhouse (@CoinhouseHQ) November 17, 2022
According to the company’s statement, this decision announced as temporary results mainly from its exposure to Genesis Tradinga company that had already found itself in difficulty following the debacle encountered by Three Arrows Capital (3AC), and which recently decided to suspend its withdrawals because of its own exposure to FTX (to the tune of $175 million). .
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Coinhouse says its platform is not impacted per se and the temporary suspension of withdrawals is only due to the counterparties of its crypto passbook offer :
“Counterparties used, in particular Genesis, announced on the afternoon of November 16 that they were facing a liquidity shortage: they have blocked withdrawals as they cannot honor requests on time, due to the overall tensions in the crypto market and pressure on liquidity. We had no choice but to note the default of these counterparties, and their impossibility to return the crypto-assets entrusted to them, which forces us to suspend for the moment the withdrawals in the savings accounts as well as, as a precaution, the investments. »
Nicolas Louvet, CEO of Coinhouseasserted on November 11 via a tweet that the bankruptcy protection of FTX and its subsidiaries had no consequences for Coinhouse and its clients’ funds:
📢 The protection of the bankruptcy regime (chapter 11) of @FTX_Official and its 130 subsidiaries has no consequence on the services offered by @CoinhouseHQour clients’ funds and the day-to-day management of our operations #crypto.
— Nicolas Louvet (@LouvetNicolas) November 11, 2022
According to the information available, just under 10,000 customers would benefit from this crypto passbook offering up to 6% annual returns.
In parallel with its registration of PSAN, Coinhouse obtained a license in Luxembourg from the Commission de Surveillance du Secteur Financier (CSSF) at the beginning of the year in order to be able to develop a subsidiary in the country.
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