Genesis owes $900 million to cryptocurrency exchange Gemini. Gemini CEO Cameron Winklevoss and DCG – Genesis’ parent company – Barry Silbert have waged a war from afar through the media.
Why is this important?The FTX case was a real earthquake in the crypto world. Even safe values, like bitcoin, could not escape. A new scandal, worth almost a billion dollars, broke out at the beginning of the year and is closely related to FTX.
News: The CEOs of Gemini and Genesis are engaged in a war of attrition.
- Mr Winklevoss started the controversy on Twitter by posting an open letter to Mr Winklevoss. Silbert on Monday, in which he claims DCG and its cryptocurrency lending arm Genesis are dragging things out to reset. 900 million dollars frozen that owe to the users of Gemini Profit Program.
- “Over the past six weeks, we have done everything we can to engage with you in good faith and cooperatively to reach a consensual settlement for you to pay the $900 million you are owed,” wrote Cameron Winklevoss, who leads Gemini with his twin brother. Tyler, in an open letter to Barry Silbert.
- According to Winklevoss, DCG owes its Genesis subsidiary $1.67 billion. Most of it is money the broker owes Gemini’s creditors. Funds from these Gemini clients were used by DCG “to drive greedy share buybacks and illiquid venture investing,” the open letter said.
- Silbert was not untouched by these accusations, to say the least. The latter tweeted in response that “DCG has not borrowed $1.67 billion from Genesis” and that “DCG has never missed an interest payment to Genesis and is up to date on all outstanding loans. Classes ; next maturity of the loan is May 2023.” He concluded his tweet by saying that “DCG submitted a proposal to Twins representatives on Thursday, but never heard back from them.”
Context: The public dispute between these two major crypto firms threatens to further undermine confidence in the industry thereafter bankruptcy of FTX shook the entire industry.
- Gemini offers its customers up to 7.4% interest if they lend their crypto holdings. It then lends these properties to partners such as crypto broker Genesis. But in November, Genesis halted customer withdrawals after the FTX empire suddenly collapsed.
- According to Wall Street Journalcrypto broker DCG had outstanding loans to Alameda Research, the investment fund of FTX CEO Sam Bankman-Fried.
- The twins and the Winklevoss twins are being sued for defrauding investors over Earn program interest products. The program was abruptly shut down in November, effectively wiping out customers who still had accounts, according to their complaint.