Gemini’s Cameron Winklevoss insists that the digital currency group must address liquidity issues in an open letter to CEO Barry Silbert

Cameron Winklevoss, co-founder of crypto-currency exchange Gemini, published an open letter to Digital Currency Group (DCG) CEO Barry Silbert on Jan. 2, 2022, stating that it has been 47 days since Genesis withdrawals were halted. In that letter, Winklevoss claimed that DCG owed Genesis $1.675 billion. Silbert, however, responded on social media, denying the claim.

The Gemini co-founder issues an open letter to DCG CEO Barry Silbert, asking him to resolve liquidity issues by Jan. 8, 2023.

Cameron Winklevoss, co-founder of Gemini shared an open letter on Twitter Monday in hopes of getting the attention of Digital Currency Group (DCG) CEO Barry Silbert. Winklevoss said in the letter that he wrote it on behalf of 340,000 Gemini Earn users. “These users are not just numbers on a spreadsheet, they are real people” said Winklevoss. Basically, Gemini was offering Earn users up to 8 percent interest on specific digital assets, and it was able to do so because the lending arm of Genesis Global Capital was a key partner.

However, the FTX contagion spread to Genesis, a creditor in the FTX bankruptcy proceedings, and the company’s lending unit halted withdrawals and loan originations in mid-November 2022. Although Genesis was a key partner in Gemini’s Earn product, it too fell victim to FTX’s contagion. paused withdrawals the same week. The Financial Times (FT) then published a report that Genesis owed $900 million to Gemini Earn users. Gemini also formed a creditors’ committee to recover Genesis’ funds with Houlihan Lokey as financial advisor.

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In addition, disgruntled customers are preparing a class action lawsuit against Gemini that alleges the exchange defrauded customers with a bad deal. In the open letter, Winklevoss says his team tried to resolve the issue with Barry Silbert on several occasions and on December 25, 2022. The letter states that the problem is a mess “entirely of your own making” as Winklevoss accuses DCG of owing Genesis $1.675 billion.

Every time we ask you for a tangible commitment, you hide behind lawyers, investment bankers and processes“, the Gemini co-founder explains in the letter. Winklevoss further insists that the funds were used to “fuel greedy stock buybacks, illiquid risk investments, and kamikaze gray-scale NAV trades“. The Gemini co-founder added:

It has not escaped our notice that you have been working desperately to try to protect DCG from the problems you have created at Genesis. You should give up this fiction because we all know what you know – that DCG and Genesis are inseparable.

After Winklevoss posted his tweet, DCG’s CEO responded to the claims that were made. “DCG did not borrow $1.675 billion from Genesis,” said Barry Silbert, who tweeted. “DCG has never missed an interest payment to Genesis and is current on all outstanding loans; the next loan maturity is May 2023. DCG provided Genesis and your advisors with a proposal on December 29 and received no response.

Winklevoss then asked to the head of DCG if he would commit “to resolve this problem by January 8 in a manner that treats the $1.1 billion promissory bill as $1.1 billion“. Silbert did not respond to Winklevoss’ latest tweet regarding the commitment to resolve the issue by that day. The open letter to Silbert also asks that the issue be resolved by January 8, 2022.

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DCG executive’s last tweet on December 19, 2022, shared an article about GDC’s subsidiary, Grayscale Investments, which could have provided investors with a takeover bid if Bitcoin Trust’s exchange-traded fund (ETF) goals failed. In that specific tweet, someone asked Silbert how he was doing, and the GDC CEO responded in the affirmative replied:

I can’t wait for this year to be behind us.

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