Genesis files two lawsuits to recover $3.3 billion from DCG and Barry Silbert
Genesis has filed lawsuits against DCG and Barry Silbert, valued at $3.3 billion, alleging fraud and insider trading before its collapse.
Genesis has initiated a couple of lawsuits against its parent company, Digital Currency Group (DCG), and its CEO, Barry Silbert, accusing them of fraud, reckless mismanagement, and diverting over a billion dollars in value from the now-bankrupt crypto lender.
On May 19, the Delaware Court of Chancery unveiled a lawsuit detailing how DCG allegedly used Genesis as a corporate ATM, draining funds through interest-bearing loans and hidden transfers while presenting a false image of financial health.
Through the Litigation Oversight Committee (LOC) appointed by the court, Genesis' creditors claim that over a million digital coins—valued at about $2.1 billion—were diverted, even as Genesis approached bankruptcy.
According to the lawsuit, Genesis' creditors are still owed around $2.2 billion in crypto assets, including 19,086 Bitcoin (BTC), 69,197 Ether (ETH), and over 17.1 million other tokens, along with significant unpaid fees and interest as of February 9, 2025.
At the heart of the lawsuit is the claim that Silbert and other insiders ignored basic risk controls and led Genesis into reckless lending practices that ultimately served to benefit DCG's 'crown jewel', Grayscale Investments.