Cameron Winklevoss accuses crypto executives of ‘dishonest’ behavior as Gemini funds remain frozen
Cameron Winklevoss, co-founder of crypto exchange Gemini Trust Co, has publicly accused his digital assets colleague Barry Silbert of “malicious delaying tactics” related to nearly $1 billion in Gemini client assets that have been in existence for more than a year month are frozen.
In an open letter to tweetahWinklevoss, 41, claimed that Silbert, CEO of Digital Currency Group, has stalled for over a month on repaying money it owes to users of Gemini’s Earn program.
Under the Earn program, investors lent Gemini crypto assets in exchange for interest payments of up to eight percent. Gemini, in turn, loaned those assets to Genesis Global Capital – one of the Digital Currency Group companies.
Cameron Winklevoss, 41, has publicly asked crypto executive Barry Silbert to return his client’s funds, which were likely lost when FTX imploded in November
Winklevoss, which runs Gemini Trust Co. — a crypto exchange — has clients who owe $900 million borrowed from the company Genesis, a DCG subsidiary
Genesis halted withdrawals in early November following the collapse of crypto trading firm FTX. Genesis reportedly had significant outstanding loans to FTX’s sister company, Alameda Research, and halted all transactions citing their implosion.
This stop has led to a liquidity crisis at Gemini, which the Winklevoss twins are now apparently processing in real time via the Twitter war.
In the letter he released Monday, Winklevoss accused Silbert of repeatedly dodging Gemini executives over the past month and a half and refusing to create a repayment plan for the $900 million Gemini loaned Genesis.
Gemini and Tyler and Cameron Winklevoss were sued by investors last week for fraud and allegedly selling interest-bearing accounts without registering them as securities.
Winklevoss accused Digital Currency Group of owing Genesis $1.675 billion, money that could be used to repay Gemini and other lenders to Genesis.
However, in an online response, Silbert said that DCG did not borrow the money from Genesis and made all outstanding loan payments to Genesis.
He also claimed that “DCG submitted a proposal to Genesis and its advisors on December 29 and received no response.”
Barry Silbert, the founder and CEO of Digital Currency Group, the company that owns Genesis, says DCG did not borrow $1,675 from Genesis
Following FTX’s implosion in November, Gemini Trust Co. halted transactions for its Earn crypto lending subsidiary, which had loaned more than $900 million to Genesis
Cameron Winklevoss wrote an open letter to Barry Silbert about the $900 million owed to his Gemini clients
Winklevoss fired back, “There you are again. Stop pretending that you and DCG are innocent bystanders and have nothing to do with causing this mess.
“It’s completely disingenuous.”
“So how does DCG owe Genesis $1.675 billion if it didn’t lend the money? Oh yeah, that promissory note…” Winkelvoss wrote, implying that Genesis had loaned the funds to DCG.
Genesis previously told its clients that its FTX exposure could take “weeks” to find a possible way forward and that bankruptcy is a possibility.
Winklevoss, facing the lawsuit and mounting pressure from his own disgruntled customers, said he made several suggestions to Silbert for a way forward, including one as recently as Christmas Day.
He claimed that the $1.675 billion “is money owed by Genesis to “Gemini customers” and other creditors.”
“It hasn’t escaped our notice that you’ve been working desperately to rid DCG of the problems you caused Genesis,” Winklevoss wrote.
“You should refrain from this fiction because we all know what you know — that DCG and Genesis aren’t mixed together.”
The relationship between DCG and Genesis bears similarities to that between decimated crypto trading firm FTX and its sister trading arm Alameda Research
The money in question, Winklevoss wrote, was used for DCG’s failed ventures, as well as “greedy share buybacks” and “illiquid venture investments.”
The Gemini/Genesis break is the most recent result of the FTX/Alameda Research collapse, and the relationship between Genesis and DCG somewhat reflects the problematic mixing of FTX and Alameda.
FTX founder and disgraced former CEO Sam Bankman-Fried will appear in court in Manhattan Tuesday to face charges of fraud by US prosecutors. It has been reported that he will plead not guilty.
https://www.dailymail.co.uk/news/article-11593381/Cameron-Winklevoss-accuses-crypto-exec-disingenuous-behavior-Gemini-funds-remain-frozen.html?ns_mchannel=rss&ns_campaign=1490&ito=1490 Cameron Winklevoss accuses crypto executives of ‘dishonest’ behavior as Gemini funds remain frozen