The US government launched a 58-page lawsuit against it Twinreal estate agency founded by Cameron It is Tyler WinklevossThe GenesisThe Digital Currency Group (DCG) It is Barry Silbertfounder of these two companies, and Michael Moro.
According to the statement published on Thursday (19), the defendants have caused damage to more than 230 thousand investors. The sum of debts exceeds the amount of 1 billion dollars (R$5 billion).
The lawsuit alleges that all of the companies listed knew that Genesis’ main customer was Alameda Research – a company founded by Sam Bankman-Fried and used to divert client money from his bankrupt brokerage, FTX – but did not disclose this detail disclosed to the authorities. parties interested.
The dispute between the Facebook twins and the Digital Currency Group
Cameron and Tyler Winklevoss, known as the Facebook twins after winning a lawsuit against Mark Zuckerberg, invested much of their fortune in Bitcoin and launched a brokerage, Gemini, in 2015.
Years later, Gemini began offering its customers a service called Gemini Earn, which promised guaranteed returns. To deliver these bitcoins, the broker used the services of Genesis, a company of the Digital Currency Group (DCG), which lent cryptocurrencies to other companies.
Shortly after the bankruptcy of FTX, Sam Bankman-Fried’s brokerage, Genesis was also declared bankrupt, making it clear that there was a connection between the two. Gemini was clearly shocked and had to stop cryptocurrency withdrawals for its customers.
More than just public accusations on social media, Facebook twins have also sued DCG and accused Genesis’ parent company of fraud. In addition to Genesis, DCG also controls Grayscale, responsible for the largest Bitcoin fund in the world, as well as the Coindesk portal and other smaller companies.
As if this dispute wasn’t big enough, the US Securities and Exchange Commission (SEC) later accused the two companies of offering unregistered cryptocurrency securities.
The US government is suing DCG, Genesis, Gemini and Barry Silbert
The last to enter this battle was New York State. In a document published on Thursday (19), New York Attorney General Letitia James announced that the state is suing Gemini as well as Genesis, Digital currency Group and Barry Silbert for defrauding them of a billion dollars.
“Gemini has repeatedly assured investors that investing with Genesis through the Gemini Earn program was a low-risk investment”indicates a highlighted area. “However, the OAG investigation found that Gemini’s internal analysis of Genesis showed the company’s finances were risky.”
“The lawsuit alleges that Gemini knew that Genesis’ loans were insufficiently collateralized and at one point were highly concentrated in one entity, Alameda. [Research] of Sam Bankman-Fried, but has not disclosed this information to investors.”
According to the lawsuit, more than 230,000 investors were harmed, with the amount involved exceeding the US$1 billion (R$5 billion) mark. If we divide this amount by the number of investors, we arrive at an average of R$22,000 per investor.
“These cryptocurrency companies lied to investors and tried to hide losses of over a billion dollars, and it was middle-class investors who suffered.”said Attorney General Letitia James.
On social media, Cameron and Tyler Winklevoss shared an official note published by Gemini, highlighting that they, like Earn investors, are also victims of Genesis and the Digital Currency Group.
“The New York Attorney General’s lawsuit confirms what we have said all along – that Gemini, Earn users and other lenders were victims of massive fraud and were systematically “lied” by these parties about “the financial condition of Genesis.” That said, we strongly disagree with the New York Attorney General’s decision to also prosecute Gemini. Blaming a victim for fraud and deception is futile and we look forward to defending ourselves against this inconsistent position.”
Today the @NewYorkStateAG sued Genesis, the former CEO @michaelmorothe parent company @DCGcoand the CEO of DCG @BarrySilbert for conspiracy to lie and defraud Gemini, Earn users and other Genesis creditors. The NY AG’s lawsuit confirms what we’ve been saying all along…
— GeminiTrustCo (@GeminiTrustCo) October 19, 2023
Digital Currency Group as well as Genesis, Michael Moro and Barry Silbert have not spoken publicly about the lawsuit. The space is available.
Source: Live Coins
Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
