Winklevoss’ Feud with Genesis Leads to Earn Users’ Class-Action Request

<p>On Monday, Cameron Winklevoss, the Co-Founder of the crypto exchange Gemini, accused the CEO of Digital Currency Group, Barry Silbert, of “bad faith stall tactics” in resolving the payment of a $900 million debt.</p><p>Winklevoss’ Allegations against DCG and Genesis</p><p>The publicly posted letter from one of the Winklevoss twins to Silbert alleged that Gemini had waited six weeks trying to bring Genesis Global Capital and its parent company Digital Currency Group for a <a href=”https://www.financemagnates.com/cryptocurrency/crypto-lender-genesis-seeks-1b-emergency-loan/” target=”_blank” rel=”follow”>discussion on the repayment</a> but failed.</p><p>“For the past six weeks, we have done everything we can to engage with you in good faith and collaborative manner in order to reach a consensual resolution for you to pay back the $900 million that you owe, while helping you preserve your business,” Winklevoss’ letter stated. “However, it is now becoming clear that you have been engaging in bad faith stall tactics.”</p><blockquote class=”twitter-tweet”><p lang=”en” dir=”ltr”>Earn Update: An Open Letter to <a href=”https://twitter.com/BarrySilbert?ref_src=twsrc%5Etfw”>@BarrySilbert</a> <a href=”https://t.co/kouAviTho4″>pic.twitter.com/kouAviTho4</a></p>— Cameron Winklevoss (@cameron) <a href=”https://twitter.com/cameron/status/1609913051427524608?ref_src=twsrc%5Etfw”>January 2, 2023</a></blockquote><p>Winklevoss revealed that Gemini had sent two payment proposals to Silbert and his companies but has yet to receive a response or willingness to resolve the issue. He added: “Every time we ask you for tangible engagement, you hide behind lawyers, investment bankers, and process. After six weeks, your behavior is not only completely unacceptable, it is unconscionable.” </p><p>According to Winklevoss, the Digital Currency Group’s subsidiary, Genesis owes $1.675 billion to Gemini, which belongs to “Earn users and other creditors.”</p><p>Additionally, Silbert responded to the allegations, tweeting that DCG “did not borrow $1.675 billion from Genesis” and the company never missed an interest payment deadline. However, Winklevoss challenged these claims, revealing Genesis borrowed the proceeds with promissory notes.</p><blockquote class=”twitter-tweet”><p lang=”en” dir=”ltr”>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…</p>— Cameron Winklevoss (@cameron) <a href=”https://twitter.com/cameron/status/1609942891648126981?ref_src=twsrc%5Etfw”>January 2, 2023</a></blockquote><p>Class Action Arbitration Request</p><p>In response to the public feud between Winklevoss and Silbert, three Genesis earn users have filed a class action arbitration request against Genesis Global Capital and Digital Currency Group. The Genesis earn users alleged that Genesis failed to return their and other Gemini Earn users’ assets, thus breaching the Master Agreement between the two companies. On top of that, they accused Genesis of concealing its state of insolvency from its customers.</p><p>A class-action arbitration is a dispute resolution process that a third-party arbitrator resolves. It is a voluntary and less formal process and is seen as an alternative to a class-action lawsuit.</p><p>Check out the recent London Summit session on “Reimagining Crypto Market Structure.”</p><p>Moreover, Gemini and Winklevoss twins are <a href=”https://www.financemagnates.com/cryptocurrency/news/gemini-winklevoss-twins-face-class-action-lawsuit-over-lending-products/” target=”_blank” rel=”follow”>facing a class-action lawsuit</a> by investors for failing to register its Earn products as securities.</p><p>Gemini abruptly halted the redemption of its interest-bearing crypto products, offered under Gemini Trust Earn, in mid-November, just after Sam Bankman-Fried’s FTX filed for bankruptcy. The move was made as the <a href=”https://www.financemagnates.com/cryptocurrency/bahamas-regulator-challenges-ftx-ceos-allegations-over-customer-funds/” target=”_blank” rel=”follow”>FTX collapse triggered a liquidity crisis</a> at Genesis Trading, a major borrower of Gemini’s lending products.</p>

This article was written by Arnab Shome at www.financemagnates.com.