As a preamble, Genesis partnered with Gemini on Gemini's Earn program. Last November, Genesis halted withdrawals on the program. Barry Silbert, the head of DCG who is the parent company of Genesis, said the halt “was made in response to the extreme market dislocation and loss of industry confidence caused by the FTX implosion”. We immediately had a problem here. Because Genesis(through DCG) blamed the halt on the market, as opposed to just allowing people to withdraw their money. The founders of Gemini, the Winklevoss twins, did indeed accuse Silbert of making “false statements and misrepresentations about the solvency and financial health of Genesis”, going so far as to accuse them of accounting fraud.
It was then later on we discovered the fact, Genesis lost $175M when FTX collapsed. We also learned Genesis lost $1.2B in the collapse Three Arrows Capital. This left around 340,000 users of the Gemini Earn program unable to withdraw and the accounts short of a collective $900,000. If they was the end of the story that would have not been so bad….but it isn't. See, while FTX apparently owned Genesis $175M, FTX has now laid claim to $3.9B from Genesis as mostly an attempt of clawbacks. FTX said “Genesis was one of the main feeder funds for FTX and instrumental to its fraudulent business model.” It is certainly…interesting to see FTX calling anyone else a fraud.
In addition to all this, Genesis and Gemini are facing a sizable fine from the SEC for unregistered securities offerings which will easily amount in the multi-millions. So Gemini Earn are owned 900 Million, which Genesis and DCG clearly do not have as even when FTX collapsed DCG could only give them around 120M of the 175M they lost. DCG also previously promised 1.1 Billion to Genesis to cover the 1.2 Billion they lost with Three Arrows, however Winklevoss calls this “complete gimmick” that did nothing to help Genesis. DCG also failed to make a scheduled $630 million loan payment to Genesis which Winklevoss says was a ploy to obtain “infinite forbearance” on the loan, that is, basically never pay it. They are down $1.3 Billion (from Three Arrows + Gemini Earn) and are facing a further 3.9 Billion loss from FTX's claims, on top of how much ever the SEC fine amounts to.
Winklevoss has now sued DCG after promising to do so if DCG does not agree to Gemini’s proposal of what he calls a “Final Offer” to pay a near $1.5 billion settlement to Gemini Earn customers by the end of this week. Barry Silbert also has refuted Winklevoss' claims at every turn.
And out of all of this, the retail customers will probably be the ones holding bags.
https://blockworks.co/news/genesis-clawback-claim-ftx
https://www.ft.com/content/b6680e41-56d1-4a18-99b3-569bb6d3d999
https://www.forbes.com/sites/johnhyatt/2023/01/10/who-is-barry-silbert-the-former-crypto-billionaire-that-cameron-winklevoss-is-accusing-of-accounting-fraud/?sh=686095ab7906
TLDR: Gemini owes customers almost 1 Billion. Customers say Gemini is a fraud company. Gemini claims Genesis owes at least 1.5 Billion. Now Genesis is a fraud. FTX owes Genesis millions, but FTX claims Genesis owes 4 Billion through clawbacks. FTX calls Genesis a fraud and FTX…well we know. DCG apparently “owes” Genesis 1.1 Billion but has failed to make at least 600M of the payment. DCG is apparently also a fraud.
Isn’t this what governments do aswell? Everyone is in debt and the money just doesn’t exist
Its all just infights between the parasites disecting the body. They couldnt give less of a fuck how few sad little crumbs get left for investors. Cant change a thing and cant stop them doing it.
I’m betting FTX are the bad guys in this scenario
FTX did a lot of stupid stuff by themselves but it blows my mind how many other companies were heavily invested in FTX without checking that oh I don’t know, they weren’t committing mass fraud.
The current situation between them:
>And customers are, once again, going to be the ones to suffer
And once again, lawyers are the ones going to be licking their lips and filling their pockets!
Every one of them has shit in their nests. It’s sad how funds were mismanaged so badly.
Exchanges have been swapping funds around to cover customer deposits and withdrawals. That’s pretty widely known.
>TLDR: Gemini owes customers almost 1 Billion. Customers say Gemini is a fraud company. Gemini claims Genesis owes at least 1.5 Billion. Now Genesis is a fraud. FTX owes Genesis millions, but FTX claims Genesis owes 4 Billion through clawbacks. FTX calls Genesis a fraud and FTX…well we know. DCG apparently “owes” Genesis 1.1 Billion but has failed to make at least 600M of the payment. DCG is apparently also a fraud.
My brain exploded from this
Mismanagement and human greed can really cause insane harm.
It doesn’t matter who was in the wrong, they affected retail users the most. They should be doing whatever they can to fix the mess they made.
I think a better TLDR would be:
The only winners are lawyers and law firms!
I want my $80 eth and my stupid nifty nana n f t . Hello sbf I know you understand emojis 🌈🩳🤡🐻🧻👋🏻
The only people who win all the time are lawyers on both sides, they get paid no matter what.
I should have picked a different proffesion.
When criminals come together,we end up having plenty of victims. I hope they face justice.
And they’re all laughing while they play it out for the courts and media. All the top brass in all of these companies (and their lawyers) made, and are making, one heck of a payday.
no you movement, where customers are the one losing money
It’s truly incredible how almost every centralized entity in crypto is a scam, grift or doing something illegal/shady.
My $13 in BAT I acquired from Brave browser are lost forever….
Pea in the Shell game…pick where the pea is and win fabulous prizes and cash!
Lawyers and the companies CEOs are the one ones who made money off of this whole ordeal. The customers were meant to get fucked since the beginning.
The lawyers are running out the clock (“billable hours”) to vacuum up whatever billions in customer funds are left.
It’s called the contagion effect.
When one owns another company money and they don’t have the money, that company is then in trouble and goes like this down the line of company’s.
Also know as the domino affect
It’s called the blame game, and crypto companies love to play it!
Well put, OP… Crypto is supposed to offer the little guys some protection from these greedy rich a$$holes. SMH
Why is every top comment blaming lawyers and not …. you know… the fraudsters that ran these companies? Truly the dumbest timeline.
And with all these chaos lawyers are the ones having a profit, I wonder if any of them are crypto enthusiasts too.
Let the dominos fall, I’m here for the discount.
Anyone getting caught out not doing self-custody at this point is a sucker. Crypto is supposed to counter corrupt centralized entities, not give them untold power. Laziness is no longer an excuse after what have happened in the recent years.
Use Coinbase
(Insert Spider-Man pointing meme)
Regulation? Pffft, crypto doesn’t need regulation, it’s doing just fine without it.
The only customers to suffer are the ones who keep their coins on the exchange.
Insert Spider-Man pointing at other Spider-Man gif 😂
It’s hilarious when multi-billionaires (Wiklevosses, Barry Silbert & such) lose hundreds of millions of customer assets and refuse to reimburse even a penny.
It’s almost as if everyone buying crypto put their money in a big, black box hoping to get rich, but the only ones who truly made it were the ones holding the box, asking for more money and spinning a story about how much money was being thrown in, all whilst secretly taking progressively riskier bets and more brazen withdrawals from said box.
This complicated conflicts between Gemini, Genesis, DCG, and FTX are worrying the crypto community and may affect customers.
https://www.amazon.com/Elements-Style-Fourth-William-Strunk/dp/020530902X/ref=asc_df_020530902X/?tag=hyprod-20&linkCode=df0&hvadid=312128284741&hvpos=&hvnetw=g&hvrand=2726902365868247188&hvpone=&hvptwo=&hvqmt=&hvdev=c&hvdvcmdl=&hvlocint=&hvlocphy=9005659&hvtargid=pla-405693442765&psc=1
Say it with me people!!
“Not your keys, not your crypto!!!”
Too many stories about too many people being burned by too many alt coins. I’d just stick with BTC and ETH
The whole thing is fucky if you ask me.
The SEC is right, the cartels hold billions in Crypto now.
One of these days, one of these crypto-bro-VC’s is going to rip off the wrong kid whose family runs a major Cartel and their own family is going to end up brutally tortured and murdered.
We won’t know about it or won’t find out about it for years because they will just all “disappear”.
Oh, wait.. Ruja Ignatova..
Looking at the Winklevoss Twins suing Barry Silbert I think the idea is to force Digital Currency Group to possibly sell off some of their assets. We have not seen much talk about the news source Coindesk, which DCG owns, or Grayscale Investments beings shopped. Granted I do not know all the ins and outs but I would think that someone like BlackRock, Vanguard, or Fidelity could be interested in Grayscale since it is established and has all the groundwork laid. Those companies could really force the SEC to allow Grayscale to transform into the ETF that it has tried several time to do.
Oceangates implodes: They should have been regulated!
Exchange implodes: We dont need regulation
Criminals gonna crime
I had some AMD stocks on FTX. Glad to know tech stocks hitting ATH 🥲
Gemini should have made their customers whole a long time ago.
Sooo, get my coin off Gemini?
That money is long gone.
They are all running fractional reserves and just pray customers don’t pull their money out.
Not your keys not your coins!!!