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United States-based cryptocurrency exchange Gemini has announced legal action against the conglomerate Digital Currency Group (DCG) and its CEO Barry Silbert, claiming \u201cfraud against creditors\u201d.<\/p>\n
In a July 7 filing in a New York court, Gemini alleged DCG and Silbert engaged in a scheme involving lending \u201chuge amounts of cryptocurrency and U.S. dollars\u201d to Genesis. According to the filing, Gemini seeks to recover funds incurred as a result of \u201cDCG\u2019s and Silbert\u2019s false, misleading, and incomplete representations and omissions to Gemini, and Defendants\u2019 role in encouraging and facilitating Genesis\u2019s fraud against Gemini\u201d, adding the firm would also pursue legal avenues in Genesis\u2019 bankruptcy case.<\/p>\n
Genesis had been the crypto lender responsible for operating an Earn program in partnership with Gemini. However, the firm halted withdrawals in November 2022, citing \u201cunprecedented market turmoil\u201d and subsequently filed for Chapter 11 bankruptcy. <\/p>\n
According to a July 7 Twitter thread from Gemini co-founder Cameron Winklevoss, Silbert knew<\/a> Genesis was \u201cmassively insolvent\u201d when attempting to continue the Earn program. The complaint included alleged false financial reporting from DCG and Silbert starting with the collapse of Three Arrows Capital in June 2022, which \u201cblew a $1.2 billion hole in Genesis\u2019s balance sheet\u201d.<\/p>\n \u201cBarry, DCG, and Genesis all conspired to create false financial reports to hide the truth from Gemini and creditors,\u201d claimed Winklevoss. \u201cThis fraud goes to the very top. Barry Silbert and other DCG executives were directly involved in these lies and they lied again and again to conceal the truth from Gemini and other creditors.\u201d<\/p>\n 1\/ Today, @Gemini<\/a> filed a lawsuit against @DCGco<\/a> and @BarrySilbert<\/a> personally in New York court. Barry was not only the architect and mastermind of the DCG and Genesis fraud against creditors, he was directly and personally involved in perpetrating it.<\/p>\n \u2014 Cameron Winklevoss (@cameron) July 7, 2023<\/a><\/p><\/blockquote>\n This is a developing story, and further information will be added as it becomes available.\n<\/p>\n <\/div>\n\n