Cameron Winklevoss, a co-founder of the cryptocurrency exchange Gemini, released a letter that was addressed to Barry Silbert, the founder and CEO of the Digital Currency Group (DCG). The parent company of Grayscale and the cryptocurrency lender Genesis, Winklevoss, blasted his partner for the situation that is putting thousands of customers through financial difficulties.
Winklevoss gives a face to the 340,000 Earn users in the letter, identifying them as the "actual people" who lent money to Genesis. By using Winklevoss' logic, these people gave Barry Silbert and the Digital Currency Group their money. the letter is read:
"These users are more than just spreadsheet data points. They are actual individuals. a single mother who gave you a loan for her son's education. a father who gave you money from his son's bar mitzvah. A husband and woman who gave you the loan of their whole life savings deserve answers, and we are here to get them."
According to the letter Winklevoss posted on Twitter, Genesis owes Gemini $900 million for money that the exchange lent to it as part of the Earn program.
Earn Update: An Open Letter to @BarrySilbert pic.twitter.com/kouAviTho4
— Cameron Winklevoss (@cameron) January 2, 2023
Because DCG owed Genesis money that it had neglected to repay, according to Winklevoss, Genesis was unable to pay Gemini.
Gemini was sued by investors on December 27. The lawsuit asserts that Gemini committed fraud and violated securities laws since the Earn program was unregistered and investors were unable to accurately analyze its risks. Earn stopped paying investors in November.
In a tweet in response to Wilkevoss' letter, Silbert refuted a number of statements, including "DCG did not borrow $1.675 billion from Genesis" and "never missed an interest payment to Genesis and is current on all outstanding loans," without providing any additional context.
DCG did not borrow $1.675 billion from Genesis
— Barry Silbert (@BarrySilbert) January 2, 2023
DCG has never missed an interest payment to Genesis and is current on all loans outstanding; next loan maturity is May 2023
DCG delivered to Genesis and your advisors a proposal on December 29th and has not received any response
Furthermore, Silbert asserted that DCG provided a strategy for resolving the dispute to Genesis and Winklevoss' advisors on December 29 but had not received a response.
Genesis' liquidity issues caused Gemini Earn's product to stop operating. The impact of FTX on the company led to its search for funding to restart. Gemini Earn and Genesis presently have customers' money locked up.
