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Gemini sues DCG

Gemini sues DCG

Crypto exchange Gemini Trust has filed a lawsuit against Digital Currency Group and its CEO Barry Silbert over a failed partnership between the companies.

The suit alleges “fraud and deception” from DCG and aims to recover “damages and losses” related to the partnership.

Gemini partnered with DCG Genesis for its Earn interest-bearing product, but customer assets were frozen after Genesis halted withdrawals following the FTX collapse.

In January, Cameron Winklevoss claimed that Genesis owes more than 340,000 Gemini customers a total of $900 million.

Says the filing: "From the beginning, Genesis - acting in concert with Defendants and with Defendants’ active support and encouragement - induced the Gemini Earn Lenders to lend by touting Genesis’s purportedly robust risk-management practices and a supposedly thorough vetting process of the counterparties to which it re-lent the assets. Those were lies."

Gemini also claims that Silbert asked the firm to carry on with the Earn offering, despite being "aware at the time that Genesis was massively insolvent".

In a tweet, DCG says the allegations are "defamatory" and the filing a "publicity stunt".

In January, the SEC charged both Genesis and Gemini with offering and selling unregistered securities over the Earn product - which was ended earlier that month.

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