Gemini’s C. Winklevoss Issues Ultimatum to DCG CEO B. Silbert, Says DCG and Genesis Are ‘Beyond Commingled’

• Gemini co-founder Cameron Winklevoss published an open letter to Digital Currency Group (DCG) founder and CEO Barry Silbert on Twitter.
• Winklevoss accused Silbert of engaging in “bad faith stall tactics” related to Genesis’, DCG’s subsidiary, $900 million debt to Gemini Earn customers.
• Winklevoss said that Silbert’s DCG borrowed $1.675 billion from Genesis, essentially Gemini Earn’s customer deposits. 
• Gemini’s boss also said that DCG and Genesis are “beyond commingled” and that  “everyone takes orders” from Silbert.
• Winklevoss issued an ultimatum to Silbert, saying he needs to publicly commit to solving the problem by January 8th.
• Silbert responded by denying all allegations.
• Gemini Earn halted withdrawals on November 17 after Genesis announced it was suspending redemptions and new loan originations.

Updated on January 2nd, 2023 at 4:30 PM UTC

Cameron Winklevoss Doubles Down on Barry Silbert Criticism, Asks Again if He Can ‘Commit on Solving This’

Winklevoss was not happy with Silbert’s response to his letter. Gemini’s co-founder doubled down on the criticism addressed towards Silbert and called him “disingenuous.”

“There you go again. Stop trying to pretend that you and DCG are innocent bystanders and had nothing to do with creating this mess. It’s completely disingenuous. So how does DCG owe Genesis $1.675 billion if it didn’t borrow the money? Oh right, that promissory note…” he said.

Winklevoss asked Silbert again if he could commit to solving the situation by January 8th.

“Will you, or will you not, commit to solving this by January 8th in a manner that treats the $1.1 billion promissory note as $1.1 billion?” he asked.

Updated on January 2nd, 2023 at 3:52 PM UTC

Barry Silbert Denies Cameron Winklevoss’ Allegations

Silbert has responded to Winklevoss’ letter. He defended himself and his companies by denying that they’re commingled and said that DCG didn’t borrow any funds from Genesis.

Silbert also said that it was, in fact, DCG who had contacted Gemini but has yet to receive a response.

“DCG did not borrow $1.675 billion from Genesis. DCG has never missed an interest payment to Genesis and is current on all loans outstanding; next loan maturity is May 2023. DCG delivered to Genesis and your advisors a proposal on December 29th and has not received any response,” he said on Twitter.

Cameron Winklevoss Attacks Barry Silbert in Public Letter

Crypto exchange Gemini co-founder Cameron Winklevoss has published a public letter on Twitter heavily criticizing Digital Currency Group (DCG) founder and CEO Barry Silbert for “stalling” the process of repaying Gemini Earn users over $900 million.

Winklevoss said that Gemini has tried time and time again over the last six weeks to contact Silbert and solve the liquidity issues. However, he said that it’s becoming clear that Silbert has been “engaging in bad faith stall tactics.”

“It’s not lost on us that you started your career as a bankruptcy restructuring associate. And it’s not lost on us that you’ve been working desperately to try and firewall DCG from the problems that you created at Genesis. You should dispense with this fiction because we all know what you know – that DCG and Genesis are beyond commingled. Everyone takes orders from you and always has,” Winklevoss said.

Winklevoss accused Silbert of taking Gemini Earn users’ deposits and using them to “fuel greedy share buybacks, illiquid venture investments, and kamikaze Grayscale NAV trades that ballooned the fee-generating AUM of your Trust.” According to Winklevoss, Silbert borrowed $1.675 billion from Genesis, DCG’s wholly-owned subsidiary.

“The idea that you can quietly hide in your ivory tower and that this will all just magically go away, or that this is someone else’s problem, is pure fantasy. To be clear, this mess is entirely of your own making. […]. It is now time for you to take responsibility for this and do the right thing,” Winklevoss said.

Winklevoss said that Gemini Earn users are “tired”, “scared”, and in “dire straits”. He issued a request for Silbert to “publicly commit and solve this problem by January 8th, 2023.”

“Earn users are tired. They’re scared. Many are now in dire straits. And yet despite all that they have had to endure, they have been remarkably patient and supportive. But there is only so much more they can take. They deserve a resolution for a recovery of the assets they lent to you and an end to this nightmare. To that end, and for the final time, we are asking you to publicly commit to working together to solve this problem by January 8th, 2023. We remain ready and willing to work for you, but time is running out,” he said.

Gemini Earn halted withdrawals on November 17, right after Genesis Global Capital suspended redemptions and new loan originations in the wake of the bankruptcy of FTX.

On the Flipside

• It’s unclear who’s the guilty one in this situation. Both sides are pointing their fingers at each other.
• Neither Genesis nor Gemini Earn has resumed withdrawals or new loan issuances.

Why You Should Care

Barry Silbert and his DCG crypto empire play a vital role in the crypto industry. If his whole crypto empire is insolvent, crypto users might experience another dump in digital asset prices. Some even argue that DCG’s blow-up would be even larger than that of FTX.

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