Individual crypto companies and their (cough) related parties often have more than a whiff of ouroboros about them. But the industry as a whole mostly resembles the Spidermen circle of blame these days.
The latest example came earlier today when Gemini’s Cameron Winklevoss sent an “open letter” to crypto baron Barry Silbert of Digital Currency Group for $900 million.
Aside from the performative hand-wringing over Gemini clients like the “single mom who loaned you money for her son’s education” and a “dad who loaned you his son’s bar mitzvah money,” the most inflammatory thing was the ( Emphasis on FTAV below):
The idea in your head that you can hide away in your ivory tower and that this will all magically go away, or that this is someone else’s problem, is pure fantasy. To be clear, this mess is entirely your own making. Digital Currency Group (DCG) — of which you are the founder and CEO — owes Genesis (its wholly-owned subsidiary) approximately $1.675 billion. This is money owed to Genesis Earn users and other creditors. You’ve taken that money – school teachers’ money – to run greedy stock buybacks, illiquid venture investing, and kamikaze grayscale NAV trades that have boosted your trust’s fee-generating AUM; all at the expense of creditors and all for your personal benefit. Now is the time for you to take responsibility and do the right thing.
Silbert understandably couldn’t let the thinly veiled FTX innuendo go through and responded on Twitter within an hour.
DCG did not borrow $1.675 billion from Genesis
DCG has never missed an interest payment to Genesis and is current on all outstanding loans; next loan maturity is May 2023
DCG submitted a proposal to Genesis and their advisors on December 29 and received no response
— Barry Silbert (@BarrySilbert) January 2, 2023
Silbert previously revealed that DCG borrowed $575 million from Genesis “in the ordinary course of business” and “always structured on an arm’s length basis and settled at prevailing market interest rates.”
The disagreement appears to stem from how one looks at the $1.1 billion promissory note, due 2032, that DCG issued to Genesis when the parent company had to step in to service liabilities related to the implosion of Three Arrows, a Crypto “hedge fund” Three Arrows to acquire. On that subject, it’s worth reading Kadhim Shubber, Nikou Asgari, and Josh Oliver on the “thorny connections” between the various parts of the struggling DCG empire.
In related news, DCG’s flagship crypto product – the Grayscale Bitcoin Trust – now trading at a discount of 45 percent to its net asset value. That means its market value
As long as you’re not among the crypto bros directly affected by the shenanigans, it’s all very amusing.
Source: Crypto News Deutsch