Gemini, the popular cryptocurrency exchange founded by the Winklevoss twins, has filed a lawsuit against Digital Currency Group (DCG) and its founder, Barry Silbert. The lawsuit alleges that DCG and Silbert were involved in fraudulent activities related to the Gemini Earn program and the Genesis bankruptcy case.
According to Cameron Winklevoss, co-founder of the company, Silbert was not only the mastermind behind the fraud committed against creditors but was also directly involved in perpetrating it. Winklevoss took to Twitter to express his frustration, stating that the lawsuit tells the whole story of the deception.
The complaint lodged by the company reveals that Silbert, aware of Genesis’s massive insolvency, attempted to persuade Gemini to continue the Earn program despite the impending termination.
It is alleged that Silbert misled the company by claiming that Genesis was only facing a timing issue, concealing the true extent of the financial crisis.
Furthermore, the company accuses DCG of providing false financial reports to hide fraudulent activities. A promissory note, presented as a “Current Asset” worth $1.1 billion, was exposed as a sham, with a mere 1% interest rate.
The balance sheet manipulation and excluding the promissory note from calculations were additional efforts to deceive Gemini and other creditors.
Gemini’s lawsuit claims that the fraud involved high-ranking executives at DCG, including Mark Murphy, who was copied on disseminating fake financial reports. Murphy allegedly failed to correct the reports despite knowing they contained false information regarding DCG’s financial support for Genesis.
DCG Denies Allegations; Calls Gemini’s Lawsuit A Publicity Stunt
In response to the lawsuit, DCG released a statement dismissing the allegations as baseless and defamatory. They labeled the lawsuit a “publicity stunt” by Cameron Winklevoss to deflect blame from himself and Gemini.
DCG emphasized its commitment to reaching a fair resolution for all parties involved in the Genesis bankruptcy case.
However, as the mediation process approaches its conclusion, both Gemini and DCG await the handling of the case under Chapter 11 bankruptcy law.
The outcome of this legal battle will have significant implications for the reputation and future of both parties involved, as well as for the thousands of users affected by the Genesis bankruptcy.