Barry Silbert, CEO of Digital Currency Group, the parent company of Genesis, which announced that it could go bankrupt if it could not receive investment, made interesting statements in the message he sent to his shareholders.
“We Will Come Out of the Cryptocurrency Winter Even Stronger”
Silbert said in his statement:
“DCG will continue to be a leading founder… prev cryptocurrency We’ve survived the winter and although it may feel more severe, we will all come out of this stronger together. DCG has raised just $25 million in primary capital and we aim to generate $800 million in revenue this year.
There has been a lot of fuss over the past week and I would like to contact DCG directly to clarify where we stand.
We appreciate the offers to invest in DCG as well as the words of encouragement and support. We will notify you if we decide to undertake a funding round.
Despite challenging industry conditions, I am as excited as ever about the potential of cryptocurrencies.”
Genesis Global Capital, Genesis’ lending business, temporarily suspended repayments and new loan purchases last Wednesday, November 16, after market turmoil led to unprecedented withdrawal requests.
The CEO spoke about the state of their subsidiary Genesis:
“This is a liquidity and maturity mismatch issue in the Genesis credit book. More importantly, these issues have no impact on Genesis’s spot and derivatives trading or custody business, which continues to operate as usual. Genesis leadership and board have decided to hire financial and legal advisers, and the firm is exploring all possible options in light of the consequences following the collapse of FTX.”
DCG CEO Admits Credits From Genesis
The CEO also spoke about his company’s loan exchange with Genesis:
“There has been talk lately about intercompany loans between Genesis Global Capital and DCG. For those unaware, in the ordinary course of business DCG has borrowed money from Genesis Global Capital in the same way as hundreds of crypto investment firms.
These loans have always been structured at arm’s length and priced at prevailing market interest rates. DCG currently has a debt of ~$575 million payable in May 2023 against Genesis Global Capital.
These loans were used to finance investment opportunities and repurchase DCG shares from non-employee shareholders in secondary transactions previously highlighted in quarterly shareholder updates.”
*Not investment advice.
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