Silbert refuted several of the accusations in a tweet. In early January, Cameron Winklevoss posted an open letter to Silbert on Twitter, accusing him of “bad faith stall tactics” and intermingling of funds within his conglomerate that Winklevoss said left $900 million of customer funds needlessly in limbo. ![]() The company most recently facilitated less than $30 million in trading volume in the last 24 hours, while the biggest US crypto exchange, Coinbase Global Inc., had about $1.17 billion going through, according to industry data tracker CoinMarketCap. “Relying on Silbert’s claims, Gemini elected to delay the termination of the Gemini Earn Program - and not to explore the possibility of pursuing more rapid termination or other relief, as Gemini would have done if Silbert had stated the truth,” it added.Įarn’s implosion dealt a blow to Gemini’s reputation, and some customers with funds stuck in Earn stopped trading on the exchange. “In reality, as Silbert well knew, Genesis’s problems ran far deeper than a mere ‘timing’ issue,” said Gemini in the filing. Gemini accused Silbert of being fully aware of Genesis’s insolvency, having attempted to fill the balance sheet gap with a 10-year promissory note from DCG instead of liquid capital. Genesis was struggling financially after facing a major default from crypto fund Three Arrows Capital, which collapsed earlier that summer. Over lunch, Silbert allegedly persuaded Gemini that any troubles Genesis faced would be short-lived, and to continue to support Earn on that basis. The lawsuit said that Silbert contacted one of the Winklevoss twins in mid-October last year, after Gemini had submitted a 30-day notice to pull out of Earn. A spokesperson for DCG called the lawsuit “a publicity stunt,” adding that “any suggestion of wrongdoing by DCG or any of its employees is baseless, defamatory, and completely false.” Gemini said in the lawsuit that it was seeking to recover “damages and losses” the crypto exchange incurred “as direct result of DCG’s and Silbert’s false, misleading, and incomplete representations and omissions to Gemini.” In May, Gemini had asserted a claim on behalf of Gemini Earn users for more than $1.1 billion. “From the beginning, Genesis – acting in concert with Defendants and with Defendants’ active support and encouragement – induced the Gemini Earn Lenders to lend by touting Genesis’s purportedly robust risk-management practices and a supposedly thorough vetting process of the counterparties to which it re-lent the assets,” the filing said. ![]() When Genesis froze withdrawals in the aftermath of the collapse of FTX in November, it trapped Earn users’ funds and later made Gemini a major creditor in its bankruptcy process. Through a program called Earn for individual investors, Gemini had offered hundreds of thousands of customers the ability to earn yields on crypto tokens that were lent through Genesis. The suit was filed in the County of New York Supreme Court on Friday. The lawsuit represents the latest salvo in an months-long public dispute between the Winklevoss twins and Silbert over hundreds of millions of dollars in frozen funds related to Genesis Global Holdco, a now-bankrupt DCG subsidiary. and its chief executive officer Barry Silbert, alleging “fraud and deception” stemming from a failed lending venture between the two firms. ![]() (Bloomberg) - Gemini Trust Co., the digital-asset exchange founded by the billionaire Winklevoss brothers, filed a lawsuit against Digital Currency Group Inc.
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