According to Blockworks, Lumida Wealth co-founder and CEO Ram Ahluwalia has compared the legal issues faced by digital asset conglomerate DCG to the Enron scandal of the early 2000s. The New York Attorney General (NYAG) has filed a complaint against DCG and its CEO Barry Silbert personally, following the collapse of FTX.
Ahluwalia alleges that DCG did not let its subsidiary Genesis go into bankruptcy to protect itself, as Genesis would have called in the loans and not refinanced DCG, which did not have the cash. He claims that the legal issues at play are arguably worse than those of the Enron scandal, as DCG allegedly issued fraudulent balance sheet statements via Genesis to their customers, something Enron did not do.
In the aftermath, Ahluwalia suggests that Grayscale will likely be auctioned off due to the NYAG's request that DCG be prohibited from acting as a securities and commodities business. He also expects DCG to be mired in endless settlements and lawsuits, effectively becoming an insolvent zombie company that will never be able to raise venture capital.
