UNCHAINED: Two Genesis Creditors Describe Their Frustrations With the Bankrupt Crypto Lender
CoinDesk Podcast Network
CoinDesk
4.8 • 689 Ratings
🗓️ 6 November 2023
⏱️ 88 minutes
🧾️ Download transcript
Summary
In a rare interview, two Genesis creditors discuss their dealings with the lender and DCG, including the sales pitch that got them to give Genesis new loans after the 3AC debacle.
Two Genesis creditors, BJ and Branden, who prefer to use pseudonyms for security reasons, spoke with Unchained about the alleged fraud by the crypto lender and its parent company, Digital Currency Group (DCG). The discussion is one of the first times Genesis creditors have spoken with a media organization about the situation.
BJ and Branden explain how they gave more loans to Genesis after it took a $1.1 billion hit from the liquidation of Three Arrows Capital and how they then came to be members of the ad hoc group, a collective of Genesis customers who came together to try and save the company from bankruptcy.
They talk about how they now want DCG to pay back the $1.1 billion it owes over a shorter timeframe and to pay back any Bitcoin in actual Bitcoin. The discussion with Unchained followed shortly after New York Attorney General Leticia James filed a lawsuit against Genesis, along with its parent company Digital Currency Group, and Gemini Trust.
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Show highlights |
- What NYAG Letitia James alleged in the lawsuit against Gemini, DCG, and Genesis
- How BJ and Branden became creditors of Genesis
- How Genesis claimed it got into what it called a “liquidity mismatch”
- How, after the Three Arrows Capital collapse, BJ and Branden were reassured that Genesis had "no issues" and "was back to business"
- Whether the trading and lending units of Genesis were all part of the same company and why that distinction is important.
- What the difference is between the ad hoc group and an unsecured creditors committee
- What the creditors are proposing in order to get their assets back
- Why the creditors want to be paid in crypto, not in USD
- Whether the case will go to litigation and what Silbert can do to avoid it
Thank you to our sponsors! | Crypto.com | Arbitrum Foundation | Phemex
Guests|
Branden, Creditor of Genesis
BJ, Creditor of Genesis
Links |
Previous coverage of Unchained on Genesis and DCG:
Genesis May Be Facing Bankruptcy. Could It Take DCG Down With It?
Gemini vs. DCG Is Heating Up. Could Gemini Force Genesis Into Bankruptcy?
$630M Due Next Week: Is DCG at Default Risk?
NYAG Lawsuit
Unchained:
NY Attorney General Sues Crypto Firms Gemini, Genesis, and DCG for Over $1 Billion Fraud
The Block:
DCG says it was 'blind sided' by NYAG suit in third quarter shareholder letter
Genesis, Gemini, DCG disputes
Unchained:
Gemini Says DCG Missed $630 Million Payment Last Week
Cameron Winklevoss Threatens to Sue DCG and Barry Silbert Over Delays in Genesis Resolution
DCG Calls Gemini Lawsuit a ‘Publicity Stunt’ From Cameron Winklevoss
DCG Calls Gemini’s Complaint a PR Campaign in Motion to Dismiss Lawsuit
FTX and Genesis Reach $175 Million Settlement, Resolving Complex Dispute
DCG and Genesis Reach In-Principle Deal With Creditors
Gemini and Genesis Creditor Groups Object to In-Principle Deal to Resolve Bankruptcy
Genesis Winds Down its US Spot Crypto Trading Operation
Genesis Sues Parent Company DCG, Seeks Repayment of $600 Million
DCG Proposes Remuneration Plan That Could Enable Gemini Earn Users to Be Made Whole
Genesis Winds Down All Crypto Trading Services: Report
Gemini Pushes Back on DCG’s Remuneration Proposal, Calling it an ‘Attempt to Bait’ Earn Users
Disclaimer:
Genesis and CoinDesk are both owned by DCG.
Unchained Podcast is Produced by Laura Shin Media, LLC. Distributed by CoinDesk. Senior Producer is Michele Musso and Executive Producer is Jared Schwartz.
See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.
Transcript
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| 0:00.0 | Thanks for listening to Unchained, your no-hype resource for all things crypto, on the CoinDesk Podcast Network. |
| 0:06.5 | You can also listen to the episodes on the Unchained feed earlier if you subscribe there. |
| 0:11.7 | Plus, check out all our content on our website, Unchained Crypto.com. |
| 0:16.5 | They said, in fact, after the 3AC episode, not only have we been recapitalized, but we are massively |
| 0:23.5 | derisking our loan book. He said, we're calling back all sort of, we're reanalyzing all of our |
| 0:31.1 | borrowers, the people who borrow the Bitcoin that we deposit, and we are like changing the risk |
| 0:36.2 | levels and we are de-risking levels and we are derisking. |
| 0:37.9 | We are now much more conservative at our risk levels. |
| 0:40.8 | So if anything, depositing now is a lot less risky than it would have been a year ago |
| 0:45.9 | because we're calling back a lot of the risky loans and you are now depositing into a loan |
| 0:51.2 | book that is a lot less risky than it was. |
| 0:54.0 | In fact, it's safer now because of what happened with 3AC for you to deposit now. |
| 0:59.8 | And it kind of made sense if you believe them. |
| 1:02.2 | If you believe people are telling you the truth, it kind of made sense what he said, |
| 1:06.2 | that yes, they would be derisking the loan book. |
| 1:09.8 | And so, in fact, you are now taking less risk than you did before. |
| 1:17.6 | Hi, everyone. |
| 1:18.6 | Welcome to Unchained, your no-hype resource for all things crypto. |
| 1:21.8 | I'm your host, Laura Shin, author of The Cryptopians. |
| 1:25.4 | I started covering crypto eight years ago, |
| 1:27.4 | and as the senior editor of Forbes, was the first mainstream meter porter to cover cryptocurrency full-time. |
| 1:32.6 | This is the November 4th, 2023 episode of Unchained. Femex, a prominent crypto exchange, is at the forefront of revolutionizing centralized exchanges. |
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