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Winklevoss says crypto broker Genesis negotiating in bad faith

Published 01/02/2023, 02:27 PM
Updated 01/02/2023, 11:41 PM
© Reuters. FILE PHOTO: Cameron Winklevoss speaks at a New York State Department of Financial Services (DFS) virtual currency hearing in the Manhattan borough of New York January 28, 2014. REUTERS/Lucas Jackson

(Reuters) - Cameron Winklevoss, who founded crypto exchange Gemini Trust Co with his twin brother, on Monday accused Digital Currency Group (DCG) CEO Barry Silbert of "bad faith stall tactics" and asked him to commit to resolving $900 million worth of disputed customer assets by Jan. 8.

Gemini has a crypto lending product called Earn in partnership with DCG's crypto firm Genesis. Genesis halted customer withdrawals in November, following the collapse of major crypto exchange FTX.

Winklevoss said Genesis owed more than $900 million to some 340,000 Earn investors, and that he had been trying to reach a "consensual resolution" with Silbert for the past six weeks.

"However, it is now becoming clear that you have been engaging in bad faith stall tactics," Winklevoss wrote in an open letter to Silbert that was posted on Twitter.

"We are asking you to publicly commit to working together to solve this problem by January 8th, 2023," he added. The letter did not say what would happen if an agreement was not reached by Jan. 8.

Winklevoss wrote that DCG owed Genesis $1.675 billion, which was money that Genesis in turn owed to Earn users and other creditors, adding "this mess is entirely of your own making."

Silbert responded in a tweet that DCG did not borrow $1.675 billion from Genesis.

© Reuters. FILE PHOTO: Cameron Winklevoss speaks at a New York State Department of Financial Services (DFS) virtual currency hearing in the Manhattan borough of New York January 28, 2014. REUTERS/Lucas Jackson

"DCG has never missed an interest payment to Genesis and is current on all loans outstanding," Silbert said, adding that DCG delivered a proposal to Genesis and Winklevoss' advisers on Dec. 29 and did not receive a response.

Genesis wrote in a letter to clients on Dec. 7 that it was working to preserve client assets and strengthen liquidity, adding that it would take "weeks rather than days" to form a plan.

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