United States-based cryptocurrency exchange Gemini has announced legal action against the conglomerate Digital Currency Group and its CEO Barry Silbert, claiming “fraud against creditors”.DCG and Silbert engaged in a scheme involving lending “huge amounts of cryptocurrency and U.S. dollars” to Genesis.
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 “unprecedented market turmoil” and subsequently filed for Chapter 11 bankruptcy.Genesis was “massively insolvent” 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 “blew a $1.
“Barry, DCG, and Genesis all conspired to create false financial reports to hide the truth from Gemini and creditors,” claimed Winklevoss. “This 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.”
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