Digital Currency Group (DCG) would only have $262 million in cash and cash equivalents at the end of 2022.
In 2022, the Digital Currency Group (DCG) whale investment fund suffered a $1.1 billion loss as it struggled to rework its Genesis lending platform and deal with the recession's repercussions. On CoinDesk report, a cryptocurrency website owned by DCG, the parent company's assets were $5.3 billion as of December 31, 2022. Only 262 million USD are available in cash and equivalents. Invested assets total 670 million USD and include tokens, Grayscale Trust shares, and venture capital funds. The majority of the remaining assets are owned by the Foundry and Grayscale divisions.
All investment assets and venture portfolio valuations, as stated by a DCG official, have been determined at market value. On the other hand, the investment fund that was established in 2015 reported fourth-quarter revenue of 143 million USD, a loss of 24 million USD. Over $719 million in total revenue was generated during the year. Even yet, the market value of the company's equity is $2.2 billion, or $27.93 per share. The data shows that this judgment frequently agrees with a 75%–85% decline in the industry's equity value during the same time period. In its fourth-quarter report, DCG asserted that the effects of Three Arrows Capital's default on Genesis were incorporated in last year's financial performance in addition to the negative effects of Bitcoin and falling crypto asset valuations.
The collapse of the FTX exchange in November 2022 had a significant negative impact on Genesis, a cryptocurrency loan company, forcing it to make withdrawals and file for bankruptcy. The company's 50 largest creditors at the time were owing a combined total of up to 3.5 billion USD. Notwithstanding the challenges of the previous year, Digital Currency Group announced earlier this month that all parties had achieved an understanding about the reconstruction of Genesis.
Genesis will consequently convert $1.1 billion in assets that Digital Currency Group has agreed to lend under internal commercial paper that matures in 2032 into DCG preferred shares for creditors. When Three Arrows Capital fund files for bankruptcy in July 2022, this commercial paper is intended to save Genesis. In addition, DCG will convert its $500 million Genesis loan, which matures in May 2023, into two new loans, each having a June 2024 due date and an interest rate of 11.5% on USD and 5% on Bitcoin.