Genesis Owes Its Creditors $3 Billion - Is That too Much for DCG to Swallow? Barry Silbert Breaks Silence on Twitter
Digital Currency Group's crypto brokerage firm Genesis owes over $3 billion to creditors, pressing the crypto conglomerate to consider selling assets in its large venture portfolio to raise money.
According to a report by the Financial Times, DCG, the parent company of Genesis, plans to raise fresh cash after its lending arm took heavy losses in the wake of FTX's collapse back in November. The company is considering selling parts of its VC assets worth around $500 million.
DCG is a venture capital company focusing on the digital currency market. The conglomerate lists more than 160 companies in its portfolio on its website, of which it has acquired 28. CoinDesk, Grayscale, and Genesis are three of the biggest companies listed in its portfolio.
DCG is also an investor in U.S. crypto exchanges Coinbase and Kraken, and its other holdings include the U.S. firm Circle, which runs the stablecoin USDC, and blockchain analytics companies Chainalysis, Dune Analytics, Elliptic and Etherscan.
Genesis owes up to $3 billion to clients, including $900 million to Gemini customers and more than $301 million to the users of the Dutch crypto exchange Bitvavo. A separate group of Genesis creditors are being represented by lawyers from Proskauer Rose, as per the FT.
In the wake of FTX’s collapse, Genesis announced that it is temporarily suspending redemptions and new loan originations. In a statement on Twitter, Genesis says the “abnormal withdrawal requests” have exceeded its “current liquidity.”
The crypto lender has since revealed that it has $175 million locked in on its FTX trading account. The company tried to raise an emergency loan of $1 billion in mid-November saying that it was experiencing a “liquidity crunch due to certain illiquid
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