Cameron Winklevoss, co-founder of Gemini, has written an open letter, the second one he has written in the last 10 days, with the purpose of requesting that Barry Silbert be removed from his position as CEO of Digital Currency Group (DCG).
Winklevoss called out Silbert by saying “He has proven himself unfit to run DCG and unwilling and unable to find a resolution with creditors that is both fair and reasonable.”
Winklevoss said that Genesis, DCG, and Barry Silbert had deceived more than 340,000 Earn customers on Gemini’s behalf. It is believed that these companies worked together to provide the impression to Gemini, Earn users, other lenders, and the general public that Genesis was solvent and financially stable when this was not the case.
Winklevoss said that assets worth $2.36 billion were handed to Three Arrow Capital by DCG, which is controlled by Genesis (3AC). Genesis claimed that it had a loss of at least $1.2 billion as a result of the liquidation of the collateral.
“At this point, Barry Silbert had two legitimate options: restructure the Genesis loan book (inside or outside of bankruptcy court) or fill the $1.2 billion hole. He did neither,” the Gemini Co-founder emphasized.
DCG then “crafted campaign of lies” to make Gemini, Earn users, and other lenders believe that they had injected $1.2 billion of actual support into Genesis.
Michael Moro, then-CEO of Genesis gave a statement on Twitter that, “DCG has assumed certain liabilities of Genesis related to [3AC] to ensure we have the capital to operate and scale our business for the long-term.” But this statement by Michael Moro was “false and misleading.”
Winklevoss pointed out that DCG had not provided Genesis with genuine funds to compensate for the losses sustained by 3AC. Instead, DCG made a promissory note payable to Genesis for the sum of 10 years with a one percent interest rate and it is due in the year 2032.
This note “did nothing to improve Genesis’s immediate liquidity position or make its balance sheet solvent (more on this later).” the letter reads.
He went on to assert that 3AC was only serving as a conduit for Genesis, enabling the latter to engage in what were essentially exchange transactions of bitcoin for GBTC shares with the Grayscale Trust. He went on to make this allegation more many once.
DCG CEO Barry Silbert later put out a statement addressing the concerns “I’ve been reflecting quite a bit about the past year, the state of the industry and where things go from here.”
According to Silbert, 3AC and Genesis had a trading and lending connection, and 3AC defaulted on its loans from Genesis. However, DCG has never had a relationship with 3AC. 3AC invested in numerous Grayscale products separately.
Compiled by Coinbold