Breaking: Barry Silbert’s DCG Owes Over $3 Billion To Creditors

Read full article at Coingape.

After being caught off guard by the failure of the FTX crypto exchange in November of 2022, DCG, a conglomerate that controls crypto broker Genesis, investment management company Grayscale, and other crypto media outlets — is attempting to raise fresh capital in order to recover from its financial predicament. According to the latest reports published on Jan 12, Genesis Global allegedly owes more than $3 billion to its creditors.

DCG’s Genesis Owes $3 Billion

According to people who are familiar with the matter, the Digital Currency Group is contemplating to sell off portions of its venture capital holdings. These holdings include at least 200 crypto-related projects, such as exchanges, banks, and custodians, located in at least 35 countries. The current valuations of all these are expected to be somewhere around $500 million, as per financial experts.

Read More: Check Out The Top Crypto Telegram Channels Of 2023

DCG has managed one of the largest venture portfolios in the cryptocurrency industry. It has provided financial support to a variety of cryptocurrency exchanges, such as U.S.-based Kraken, Coinbase, and The crypto giant also backed Sam Bankman-Fried’s now-defunct FTX, in which it made an investment of $250,000 in July 2021. Among the other businesses that DCG has invested in are the American bank Silvergate, the digital wallet company Circle, the crypto lottery app Jackpocket, NFT marketplace WENEW and wallet provider Rainbow.

Genesis Amid Growing Tensions

One of the largest lenders in the crypto market, Genesis, a fully owned subsidiary of DCG, allowed clients to lend out their cryptocurrencies in exchange for hefty yields. Nevertheless, in November of last year, it stopped customer withdrawals in light of “extraordinary market turmoil.” As reported earlier on CoinGape, Cameron Winklevoss, the co-founder of the Gemini exchange, claimed that Genesis had lent more than $2.3 billion to the hedge fund Three Arrows Capital, which resulted in a loss of $1.2 billion. And more importantly, as part of its Earn program, Gemini stated that it had loaned more than $900 million worth of customer deposits to Genesis which is currently stuck; affecting around 340,000 customers in the United States.

Genesis’ debts also include $300 million to Dutch exchange Bitvavo, and also to customers of Donut, which is a crypto savings firm based out of California. In addition to the mounting pressures for Genesis, the latest reports also state a separate group of Genesis creditors who are currently being represented by the legal counsel from Proskauer Rose.

DCG is one of the largest and initial sponsors of digital assets and crypto enterprises & was established in 2015 by Silbert, a prominent banker. In 2021, its market capitalization was estimated to reach a staggering $10 billion, while it received backing from blue-chip investors such as SoftBank, Ribbit Capital, and CapitalG, the venture arm of Alphabet.

Also Read: First Ever Crypto Insider-Trading Case On Coinbase Gets 10 Months Jail Time

The post Breaking: Barry Silbert’s DCG Owes Over $3 Billion To Creditors appeared first on CoinGape.

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