Highlights of $2B Debt on Grayscale Parent Company DCG, BTC Value Wavers

  • $2 billion of debt over Grayscale Parent Company, DCG
  • Know what founder Barry Silbert said about the recent situation.
  • At the time of writing, BTC is trading at the market price of $16,615.99.

DCG on Mountain of Debt 

Recently, DCG, the owner of Grayscale, disclosed that they possess $2 billion in debt. Resulting in the value of Bitcoin (BTC) being shaky due to the problems at Genesis. 

According to the sources, the largest exchange-traded fund (ETF) that owns the most BTC in the world is Grayscale. It accounts for a total of 643,572, with its worth estimated at $$10,207,633,177 billion. This is 3.065% of the total supply of 21 million. 

Genesis is facing liquidity issues in its lending ledger books, and if the problem is not solved, it may be forced to file for bankruptcy. Market turmoil following the FTX crash, leading to “abnormal” levels of withdrawals at the crypto lender, claims to have exceeded its liquidity. 

Genesis Global Capital is a prominent crypto asset lending platform and is known as a part of its parent company, Digital Currency Group (DCG). There are certainly few possibilities of Genesis becoming another fruit of fall in the wake of FTX collapse. Other firms under the umbrella of DCG, such as Grayscale Bitcoin Trust (GBTC), could be affected indirectly. 

The crypto lending platform has $175 million of funds stuck in the FTX collapse, and it is possible that DCG may evict Genesis from the crypto conglomerate. 

The Rising Concern

According to CNBC, as on Tuesday, the founder of DCG, Barry Silbert, has joined the increasing array of crypto companies leaders who are trying to convince their respective investors of stability inside the organization. 

Silbert wrote: “We have weathered previous crypto winters, while this one may feel more severe, collectively we will come out of it stronger.” It is found that DCG has loaned Genesis a total sum of $575 million

Further, Grayscale has denied presenting Proof-of-Reserves to the public, why can be found in the tweet as on 16 November- 

“Due to security concerns, we do not make such on-chain wallet information and confirmation data publicly available through a cryptographic Proof-of-Reserve, or other advanced cryptographic accounting procedure.”

According to the media reports, investors have suffered an 83% loss in BTC since it hit its all-time high of above $69,000 in November 2021. GBTC also declined by a total of 20% percent in a week following crypto’s Legman Brothers crash of 17 November. It was trading at a discount price near 50%, which shows the decreasing interest of investors and faith in GBTC. 

Cryptocurrencies have lost approximately $2 trillion in overall market value since the peak of the bubble in the crypto industry in November 2021. At time of writing, the BTC is trading at a price of $16,615.99 with a volume of $18.74 billion in the last 24 hours. 

Latest posts by Ritika Sharma (see all)

Source: https://www.thecoinrepublic.com/2022/11/27/highlights-of-2b-debt-on-grayscale-parent-company-dcg-btc-value-wavers/