DCG asks Gemini’s lawsuit to be dismissed


The Digital Currency Group (DCG) has filed a lawsuit demanding that the Gemini crypto exchange claim against it and founder Barry Silbert be dismissed.

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DCG looks forward to the conclusion of this ridiculous lawsuit as we continue to work on our mission to accelerate the development of a better financial system.

According to the petition, DCG and Silbert were not involved in the operations of the Genesis subsidiary and the Gemini Earn program.

“[…] Gemini alleges that defendants aided and abetted Genesis’ alleged fraud through various corporate transactions and documents. […] There is no substantiated claim that the defendants were actually aware of any alleged fraud,” the document says.

At the end of 2022, Digital Currency Group recorded a loss of $1.1 billion. The main reason was the problems of the subsidiary crypto-lending platform Genesis Global Capital.

On November 16, 2022, the division froze the withdrawal of funds and the issuance of new loans. The firm cited “increased demand” from customers following the collapse of FTX.

The source of the difficulties was the collapse of the hedge fund 3AC in July of the same year. The latter failed to fulfill its obligations to Genesis Global Capital for $2.36 billion. DCG provided support to the firm.

In January 2023, Genesis Global Holdco and its subsidiaries Genesis Asia Pacific and Genesis Global Capital filed for bankruptcy. According to media reports, their liabilities exceed $3 billion. This amount includes claims from clients of the Gemini exchange for $900 million.

In May, DCG defaulted on a $630 million payment to compensate users of Gemini Earn.

Recall that in July, the Winklevoss brothers exchange filed a lawsuit against Digital Currency Group and Barry Silbert, calling the latter “the architect and mastermind of fraud.”

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