Why Digital Currency Group Is Suing Its Own Subsidiary Over $1.1 Billion Loan

Digital Currency Group has sued its subsidiary Genesis and claims that the collected crypto-money shooter actually benefited in the long term after his collapse and subsequent rescue.

In a lawsuit Submitted on ThursdayDCG said that the $ 1.1 billion loan it gave to Genesis in 2022 was ultimately more than enough to cover the losses.

Crypto -money shooter Genesis Went bankrupt in 2023 as the money had borrowed collapsed Crypto Firm Three Arrows Capital and other companies during the Berenmarkt and “Crypto -BesFetting” that spread over the industry in 2022.

DCG stepped in with capital to repay Genesis customers. But in the court case on Thursday, DCG argued that due to an increase in the value of recovered collateral from three arrow capital, his obligations under the Promesse have been reduced to zero.

This, according to the court case, is because the assets of Three Arrows Capital in Bitcoin and Grayscale Bitcoin Trust shares were that has been shot in value since 2022.

“Genesis ultimately did not suffer a loss due to the standard setting of TAC; previously benefited Genesis with hundreds of millions of dollars (who is entitled to keep Genesis),” said the court case.

It added: “Because of the considerable valuation in cryptocurrency values since the date of the petition, this has resulted in recovery that exceeds the dollar value of the claims of the creditors from the petition date.”

Genesis was a crypto -money shooter run by Crypto Kolos DCG. It enabled users to earn cash on their crypto companies by lending them to others.

Genesis has provided billions of dollars to loans to besieged crypto companies such as three arrow capital and the FTX-linked Alameda Research, which were about to fail to fault their fault because of the market infection that resulted from the collapse of Terra.

When Mega Digital Activa Brand FTX collapsedGenesis announced to customers that it would pause the recordings of his credit arm because of the “unprecedented market unrest”.

“DCG has made extraordinary efforts to voluntarily support Genesis in 2022, also by publishing a promotion to Genesis to close a potential gap of the Book shares as a result of the collapse of three arrow capital,” said a spokesperson for DCG Decrypt On Friday. “We have consistently met our contractual obligations under that memorandum, but believe that they are now completely satisfied. We simply ask the court to confirm that the valid and binding obligation was fully paid.”

Thursday’s lawsuit comes after Genesis in May sued DCG, who claims that her parent company and CEO Barry Silbert made fraudulent transfers from the lender while it collapsed in 2022. It is looking for $ 3.1 billion in compensation.

Note of the editors: This story was updated after publication with a statement from DCG.