Genesis Trading, one of the largest crypto lending institutions, said it's temporarily suspending redemptions and new loan originations in its lending business. The development is one more blow to crypto credit markets and sent bitcoin's value down.

The company said on a Wednesday call with clients that it's working to find a solution for its lending business and is pushing to present proposals next week.

The announcement comes as yet another ripple effect from the bankruptcy of major crypto exchange FTX, which this week revealed it may have "more than 1 million creditors," and after Genesis said last week that its operating capital and net positions in FTX were “not material” to its business.

"FTX events have created an unprecedented market, resulting in abnormal withdrawal requests, which have exceeded our current liquidity... In consultation with our professional financial advisors at counsel we have taken the difficult decision to temporarily suspend redemptions and the new loan origination in the lending business," Derar Islim, interim CEO at Genesis, told clients on a Wednesday morning call.

Minutes after delivering the temporary pause, crypto exchange Gemini announced it would also pause withdrawals for its Earn lending product as Genesis served as the company's major lending partner.

Bitcoin has fallen by more than 3% in the last 24 hours. Since Coindesk first surfaced the balance sheet of FTX sister firm Alameda Research on November 4, sparking speculation about both firms' financial woes, bitcoin has fallen by 21% from $21,446 to $16,577.

Last week, Genesis, a subsidiary of the Digital Currency Group, reported its derivatives business had $175 million in funds on the platform prior to its bankruptcy filing on Friday.

As the Block previously reported, Genesis also informed clients last week that Digital Currency Group provided a $140 million equity infusion in response to the FTX fiasco.

A major artery for the crypto credit market, the firm has been hit by many major crypto blowups this year, including Three Arrows Capital, which defaulted on billions of dollars in loans and filed for bankruptcy on July 7.

Genesis lent $2.36 billion to Three Arrows. Its claim in the hedge fund’s Chapter 15 bankruptcy stands at $1.2 billion, making it the largest creditor.

Following Three Arrows, Genesis announced in mid-August its CEO Michael Moro would step down in addition to a 20% layoff of its staff and reorganization of executive management.

For its third quarter, Genesis reported its lending business fell by 80% to $8.4 billion in new loans. In the third quarter, it had $2.8 billion in active loans.