Gemini CoFounder Cameron Winklevoss Accuses Barry Silbert and DCG of Fraud in Open Letter to DCG Board

Gemini partnered with DCG’s Genesis to generate yield for their consumer facing Gemini Earn product.Withdrawals from Genesis have been frozen for nearly two months due to a series of bad loans.Gemini Earn’s 340K users have not been able to withdraw their money as a result.Here’s what happened. We are learning more by the day, but at present, the basic events as we understand them are as follows: Genesis lent $2.36 billion of assets to 3AC, a Singapore-based hedge fund that went belly up in June 2022. After collateral was liquidated, Genesis indicated that it was left with a loss of at least $1.2 billion. 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.

At that point in time, the Genesis loan book was approximately $8 billion, which means that the $1.2 billion loss from 3AC would account for roughly 15% of the loan book’s assets. A restructuring then could have addressed this shortfall to achieve a full recovery of assets for all lenders — including Earn users — in a short amount of time and given them direct access to liquidity. But Barry chose not to do this. He also chose not to fill the $1.2 billion hole. Instead, he pretended to.

Beginning in early July 2022, Barry, DCG, and Genesis embarked on a carefully crafted campaign of lies to make Gemini, Earn users, and other lenders believe that DCG had injected $1.2 billion of actual support into Genesis.

Full Letter:

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