Winklevoss And Silbert Argue Over Genesis-Locked Money
In a short open letter on Twitter early Monday, Gemini co-founder Cameron Winklevoss accused Digital Currency Group CEO Barry Silbert of “bad faith stall tactics” and comingling funds at his conglomerate. The letter demanded why more than $900 million of his customers’ funds still need to be made available.
In a letter to the DCG founder, Winklevoss claimed that despite repeated attempts to communicate with Silbert and DCG, Gemini had yet to further its efforts to release cash.
“For the past six weeks, we have done everything we can to engage with you in good faith and collaborative manner to reach a consensual resolution for you to pay back the $900 million you owe while preserving your business,” Winklevoss wrote.
Since mid-November, the Earn program at Gemini has enabled users to lend their digital assets for an anticipated return. It has been suspended due to liquidity problems at Genesis and DCG that developed after FTX’s demise. Shortly after Sam Bankman-exchange Fried’s sought bankruptcy protection in November, Genesis Global Capital, the lending division of Genesis Trading, halted redemptions and new loan originations.
Winkelvoss said that Gemini contacted Silbert on December 2, made a proposal on December 17, and a revised one on December 25, but that each time they requested a concrete commitment from Silbert, “you hid behind attorneys, investment bankers, and procedure.”
Silbert Reacts
Silbert responded on Twitter with his statement, defending DCG and asserting that his business sent its bid to Gemini on December 29 but has yet to hear back.
The Winklevoss letter said that DCG owes Genesis around $1.7 billion, money owed to Gemini Earn customers, in addition to suggesting that Silbert was obstructing the process. Silbert refuted this claim and stated that DCG “is current on all loans outstanding” and has never forgotten to pay interest to Genesis.
The fight occurs while a prospective class action lawsuit is pending against the Winklevoss twins and Gemini for failing to classify its interest-bearing accounts as securities. Investors filed a proposed class-action lawsuit against the business and its founders last week in Manhattan, alleging fraud and Exchange Act breaches.
Winklevoss urged the parties to “work together to fix this matter” by January 8 in the closing of his letter.
