DCG followed experts’ guidance in Genesis’ crisis

abdelaziz Fathi

Digital Currency Group (DCG) has filed a request to dismiss the legal action brought against it by the New York Attorney General Letitia James, arguing that the lawsuit is based on “baseless innuendo” and mischaracterizations.

The lawsuit was filed last year and alleges that DCG, along with Gemini and Genesis, misled over 230,000 investors. DCG’s lawyers submitted a court document seeking to have the lawsuit thrown out, arguing that DCG followed guidance from financial experts and acted with integrity.

DCG’s founder Barry Silbert was named as a co-defendant in the lawsuit. The legal team claims that the case relies on unfounded accusations and portrays DCG’s support of its subsidiary as participation in fraud.

Specifically, DCG explains that it invested funds into Genesis following a liquidity crunch and that the promissory note was a binding obligation endorsed by advisers and the firm’s board of directors.

DCG’s defense particularly focuses on a promissory note, which it claims was “properly vetted” and “entirely valid,” contesting the NYAG’s framing of the financial instrument as part of the alleged fraud.

Despite settling with the NY Department of Financial Services (NYDFS), DCG and Silbert are now requesting the court to throw out the NYAG’s lawsuit, describing the accusations against them as “baseless innuendo, blatant mischaracterizations, and unsupported conclusory statements.”Top of Form

Separately, Digital Currency Group raised objections against the settlement reached between the New York Attorney General and Genesis.

The controversy centers around the settlement agreement designed to resolve allegations that Genesis defrauded investors. DCG’s contention is that the agreement unfairly reallocates value from lower-priority creditors to those with preferred status, thereby violating the principles of absolute priority under bankruptcy law.

DCG’s critique was formalized in an objection filed with the U.S. Bankruptcy Court for the Southern District of New York, which is tasked with approving the settlement. The parent company argues that the settlement represents an improper attempt to bypass U.S. bankruptcy statutes, describing it as a “subversive arrangement” crafted hastily and without transparency.

DCG’s contention centers around Genesis’s plan to offer its customers “additional payouts” that reflect the increased value of cryptocurrencies since January 2023, when Genesis filed for bankruptcy. DCG argues that such payouts exceed what customers and creditors are legally entitled to under U.S. bankruptcy law.

DCG insists that repayments should be based on the value of the crypto assets at the time of the bankruptcy filing, rather than their current, higher market prices. This stance is driven by concerns that Genesis’s approach could leave fewer assets available for DCG after customer repayments are made, given the rise in the value of assets like bitcoin since the filing.

Read this next

blockdag

BlockDAG Offering a Fresh Take on Meme Coin Development Amid Solana’s Challenges and Floki Inu’s Price Fluctuations With 30,000x ROI

Dive into how BlockDAG’s innovative presale, low-code platforms, and potential 30,000x ROI, outperform Solana’s technical hurdles and Floki Inu’s market predictions.

blockdag

BlockDAG Excels With $2.2M In Miner Sales And Moonshot Teaser, Overshadowing Litecoin’s Rally And Dogwifhat’s Market Highs

Explore how BlockDAG’s $2 million Miner Sales & Moonshot Teaser eclipse the Litecoin price recovery and the Dogwifhat all-time high.

blockdag

BlockDAG Leads Top 6 Cryptocurrencies to Buy in 2024 with a Potential Price Surge to $10 Leaving Cosmos, BNB, and Ethereum Behind

Discover the top six cryptocurrencies in 2024, including BDAG’s remarkable growth potential, BNB’s durability, Cosmos’ connectivity, and ETH’s eco-friendly advances.

Retail FX

Weekly Roundup: Prop firm arbitrarily accounts, Interactive Brokers’ CFDs in Japan

FX, Fintech and cryptocurrency markets have been bustling with activity over the past week, as is often the case. Keep yourself informed and ahead of the curve with a curated selection of crucial stories and developments that are most relevant to those engaged in the markets.

blockdag

BlockDAG Redefines Crypto Mining as Presale Tops $18.5M, Outshining Ethereum ETF & Dogecoin Dynamics

The recent approval of the first Ethereum ETF in Hong Kong underscores a significant advancement in the cryptocurrency’s mainstream acceptance. While Ethereum continues to attract institutional attention, the Dogecoin price prediction suggests a possible resurgence, despite its current undervaluation from past highs.

Digital Assets

Bitcoin halving is done: ViaBTC mines historic block 840K

The Bitcoin network has confirmed its fourth-ever halving block, mined by the cryptocurrency pool ViaBTC, according to data from Blockchain.com. This significant event in the Bitcoin ecosystem reduced the mining reward by half, a deflationary measure occurring approximately every four years to control the issuance of new bitcoins and curb inflation.

Retail FX

True Forex Funds now offers Match-Trader and cTrader platforms

Proprietary trading firm True Forex Funds today announced the launch of Match-Trader, a multi-asset trading platform developed by California-based FX technology provider Match-Trade Technologies.

Retail FX

CySEC hits FXORO parent with €360,000 fine

The Cyprus Securities and Exchange Commission (CySEC) has fined MCA Intelifunds, trading as FXORO, a total of €360,000 for multiple violations of the Cypriot investment laws.  

Digital Assets

Binance’s CZ in good mood ahead of sentencing, says partner

Yi He, co-founder of cryptocurrency giant Binance, has shared a positive outlook on the legal situation of the exchange’s former CEO, Changpeng Zhao. Zhao is currently awaiting a sentencing hearing scheduled for April 30 in the United States.

<