Genesis Sues Parent Company DCG and CEO Barry Silbert to Recover Billions for Creditors
Genesis Global, a once-prominent cryptocurrency lender, has filed two lawsuits against its parent company, Digital Currency Group (DCG), and CEO Barry Silbert, alleging misconduct and seeking to recover over $2 billion on behalf of its creditors.
The lawsuits—filed separately in Delaware and New York—accuse DCG and Silbert of mismanagement, self-dealing, and fraudulent transfers that contributed to Genesis' collapse and eventual bankruptcy in January 2023.
In the Delaware Court of Chancery filing, Genesis claims that Silbert and key insiders “recklessly operated, exploited, and then bankrupted” the company. The suit alleges that they misled customers and investors about the firm’s financial health while siphoning assets for personal and corporate gain, benefiting DCG and its affiliate, Grayscale Investments—though Grayscale itself was not named in the suit.
Genesis seeks to recover at least $2.2 billion worth of bitcoin, ether, and other cryptocurrencies. These funds, if reclaimed, would be redistributed to creditors still owed money after the company’s bankruptcy restructuring.
A second lawsuit filed in the Bankruptcy Court for the Southern District of New York details over $1 billion in alleged fraudulent transfers made by DCG and its affiliates, including nearly $450 million sent to DCG and $297 million in digital assets transferred to DCG International. Additionally, $34 million in questionable tax-related payments were flagged.
According to the New York filing, these actions took place as Genesis was grappling with deep financial instability, further exacerbated by the market shock following the collapse of the Terra-Luna ecosystem. Internal documents cited in the lawsuit suggest that Genesis was already insolvent by the end of 2021, with $14 billion in outstanding loans. A November 2021 risk assessment by consulting firm Oliver Wyman warned DCG of Genesis' unsustainable position—yet no corrective action was reportedly taken.
Genesis filed for Chapter 11 bankruptcy protection in January 2023, revealing it owed billions to more than 100,000 creditors. Following its restructuring, the company began distributing over $4 billion in assets to satisfy creditor claims.