Gemini Co-Founder Accuses DCG’s Silbert Of Fraud, US Officials Investigate: Report

Key Points:

• US investigators are examining fraud accusations between Cameron Winklevoss and DCG’s Barry Silbert.
• The investigation is part of an ongoing review of DCG’s internal finances and its subsidiary Genesis Global Capital.
• The $1.1 billion promissory note that DCG issued to Genesis is also under scrutiny.

According to Bloomberg, US investigators probe fraud accusations between Gemini and DCG’s Silbert, scrutinizing finances and conduct, including a $1.1B promissory note.

US investigators are looking into fraud accusations between crypto tycoons. Cameron Winklevoss, co-founder of crypto trading platform Gemini Trust Co, has accused Digital Currency Group Inc. (DCG) and CEO Barry Silbert of fraud.

DCG and Silbert have denied these claims, but federal officials are investigating as part of an ongoing review of DCG’s internal financial dealings and its Genesis Global Capital subsidiary.

Recently, prosecutors in Brooklyn, FBI agents, and US Securities and Exchange Commission staff interviewed Winklevoss to discuss his allegations. The US Attorney’s Office for the Eastern District of New York inquired specifically about Silbert’s conduct. The $1.1 billion promissory note that DCG issued to Genesis after the Three Arrows failure is also under scrutiny, as well as what Silbert told investors and others about the arrangement.

Federal prosecutors and regulators have talked to former and current Genesis executives, including former CEO Michael Moro. This scrutiny shows how last year’s crypto market tumult continues to cast a shadow over what were once some of the industry’s brightest areas.

According to a recent report by CoinMarketCap, the total market capitalization of cryptocurrencies was about $1.5 trillion as of February 2022. The industry experienced a steep drop in market capitalization during May 2022, when it fell to about $1.2 trillion before gradually recovering in the following months.

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