Gemini takes DCG and Barry Silbert to court

abdelaziz Fathi

Gemini, the cryptocurrency exchange run by the Winklevoss twins, has filed a lawsuit in a New York court against Digital Currency Group (DCG) and its boss Barry Silbert over the Genesis and Earn program sagas.


Alleging fraud against creditors, Gemini claimed in a filing today that DCG and Silbert were involved in a scheme whereby large amounts of crypto and fiat money were lent to Genesis, a subsidiary of DCG.

The filing stated that Gemini seeks to recover funds incurred as a result of Silbert’s false representations and omissions, as well as their role in facilitating Genesis’ fraud against their Earn program. Gemini also intends to pursue legal action in Genesis’ bankruptcy case.

The lending unit of Gemini suspended redemptions and new loans in November due to the collapse of FTX crypto exchange. At the time, Gemini had reportedly experienced a $563 million rush in customer outflows in a single day, which was the largest in its history.

The Earn accounts were frozen with more than $900 million in customer money after its main lending partner, Genesis Global Capital, enacted a similar freeze before going bankrupt. The program allowed Gemini users to loan crypto to Genesis with the promise of repayment with interest.

The Winklevoss twins’ exchange stressed that “The return of your assets remains our highest priority and we continue to operate with the utmost urgency.”

In a letter shared on Twitter, Gemini cofounder Cameron Winklevoss brushed off Digital Currency Group CEO Barry Silbert, accusing him of misrepresentation and accounting fraud.

“Barry, DCG, and Genesis all conspired to create false financial reports to hide the truth from Gemini and creditors. 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,” said Winklevoss.

DCG, the parent company of Genesis Global Trading, crypto app Luno, and media company Coindesk, hit back at the accusations. The firm called Winklevoss’ open letters “another desperate and unconstructive publicity stunt” designed to “deflect blame from himself and Gemini, who are solely responsible for operating Gemini Earn.”

DCG added that it would “preserve all legal remedies in response to the malicious, fake, and defamatory attacks.” Winklevoss also claims that DCG owes Genesis $1.675 billion, but the company’s CEO disputes that this figure is correct.

The legal action comes barely two days after Cameron Winklevoss made a new proposal to resolve the ongoing debt restructuring negotiations for the bankrupt crypto lender, Genesis.

Describing it as a “best and final offer,” Winklevoss presented a detailed plan worth $1.46 billion. The bid includes forbearance payments as well as new loans that are denominated in USD, Bitcoin (BTC), and Ethereum (ETH). This substantial amount will be paid out in multiple installments, with each tranche scheduled to be settled at different intervals. Additionally, a forbearance payment is included in the deal, which is set to be paid on July 21.

Read this next

Digital Assets

Binance tames up with Japan’s biggest lender to launch stablecoins

Binance Japan is planning to launch stablecoins denominated in the dollar, euro, and yen in Japan in 2024. The crypto exchange aims to introduce these tokens, and possibly more, through its partnership with Mitsubishi UFJ Financial Group’s trust banking arm.

Institutional FX

Spot FX volumes drop +10% at CLS in August 2023

Total daily traded volume submitted to CLS for settlement took a step back in August as the summer typical lull hit market activity. The metrics showed a weak performance in the group’s FX business as the Q3 got off to a calm end while no fresh events were able to whip up a market frenzy.

Digital Assets

Veteran iGaming Team Launch Crypto Casino Portal

CryptoCasinos.Casino launches as a premier destination for crypto gambling aficionados, offering in-depth reviews, comparisons, and resources to navigate the burgeoning world of cryptocurrency-based casinos seamlessly.

Digital Assets

Xsolla Announces Acquisition of AcceleratXR, A Multi-Player Platform For Games

Xsolla enhances its gaming tech suite with the acquisition of AcceleratXR, bolstering cross-platform game development and pioneering advancements in cross-play experiences for players worldwide.

Digital Assets

OKX’s PoR report shows no solvency concerns, assets worth $11.2 billion

Cryptocurrency exchange OKX has released its 11th consecutive proof-of-reserves report amid increasing demand of crypto investors asking for transparency from exchanges they trade with.

Digital Assets

Horizen Launches Decentralized Governance with Introduction of Horizen DAO

Horizen inaugurates a novel decentralized autonomous organization, inviting broader community participation and heralding a new chapter in blockchain governance.

Digital Assets

Binance France induces users to convert their fiat into crypto

Following the expiration of its partnership with Paysafe, Binance France urged its customers to convert their fiat currency holdings on the platform into cryptocurrencies.

Industry News

Exness Crowned as Best Global Multi-asset Broker at Forex Expo Dubai 2023

Cyprus-based Exness garners top honors at the Forex Expo Dubai, solidifying its esteemed position in the global financial arena.

Retail FX

CySEC cancels license of 101investing parent following €200,000 fine

The Cyprus Securities and Exchange Commission (CySEC) confirmed on Tuesday that it has wholly withdrawn the Cyprus Investment Firm (CIF) License of FX retail brokerage firm FXBFI Broker Financial Invest Ltd, trading as 101investing.