Bitcoin Will Drop To New Lows! Because… – Cryptokoin.com

Have you ever thought what happens if the biggest BTC owner with 600,000 Bitcoins goes bankrupt? It may sound a bit unusual, but there is no such thing as ‘never’ in the crypto world. Taking this into account, Nouriel Roubini, known as the crisis seer, warns that Bitcoin may soon fall further than the last determined low. According to the economist, the risk comes from the bankruptcy of DCG and Grayscale.

“Crypto is the mother of all scam houses and it’s booming!”

Economist Nouriel Roubini, nicknamed the crisis seer, warns of an impending collapse of Bitcoin (BTC). He says the possible boom will come from the risk of bankruptcy facing Digital Currency Group (DCG). In a tweet, Roubini states that DCG, the parent company of both institutional crypto trading firm Genesis Global Capital and crypto fund manager Grayscale, may be in a financial crisis right now. Based on this, Roubini makes the following statement:

Many (3AC, Alameda) tried this trade and went bankrupt. With DCG’s risk of bankruptcy (given the Genesis investment) and the lack of evidence that GBTC owns the assets it claims to own, the rebate is likely to increase even more. Crypto is the Mother of All Scam Houses. And now it’s exploding!

cryptocoin.comAs you follow, Genesis has recently stopped withdrawals on its platform. For this, he cited the contamination caused by the FTX collapse. Grayscale, on the other hand, is the largest institutional Bitcoin owner, accumulating more than 600,000 BTC. Its leading fund, Grayscale Bitcoin Trust (GBTC), is trading at a massive 42% discount in its net asset value (NAV).

“Crypto, including Bitcoin, is like a crumbling house of cards”

Nouriel Roubini made this statement while responding to Turkish-American professor and crypto trader Nic Carter’s proposal for a hypothetical trade that could turn into profit from the massive discount the GBTC fund is trading. Roubini also added that several other firms, including 3AC and Alameda, both of which are now bankrupt, have already tried this trade and failed.

The crisis oracle previously featured Grayscale and Genesis in what he called ‘Crypto’s Gangsta G Gang of 4’. The other two companies are Gemini, owned by the Winklevoss Twins, and Galaxy Digital, run by Michael Novogratz. According to Roubini, all of the firms are currently in big trouble or at risk of collapse. Roubini, among other names, likens the entire crypto market to a collapsing house of cards. In this context, Binance and its CEO also threw salvos at Changpeng Zhao.

DCG and Grayscale address investors’ concerns

Meanwhile, there is speculation that DCG is in financial trouble due to its Genesis investment. DCG has released a statement to put an end to these speculations. DCG said that the impact of Genesis’ suspension of withdrawals and new credit generation is only related to this arm of Genesis. He noted that the lender would not affect other parts of the DCG business. In this context, DCG shared the following:

The impact lies in the lending business at Genesis. Therefore, it will not affect Genesis’ trading or custody operations. More importantly, this interim action has no impact on the business activities of DCG and our other wholly-owned subsidiaries.

Grayscale has also released a similar update. However, he said he could not share proof of reserve of BTC holdings with Coinbase Custody for security reasons. However, GBTC spoke of the strict regulatory compliance with which it operates its funds. Therefore, he noted, there is ample reason for investors to remain calm. In this context, Grayscale draws attention to the following:

The rules by which Grayscale operates prohibit it from lending its core assets to any other firm. Also, these rules mean that Grayscale has exclusive ownership of the assets.

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