Digital Currency Group (DCG) is suing its subsidiary, Genesis, claiming that a $1.1 billion loan provided to Genesis was sufficient to cover its losses following the lender's collapse in 2022. The lawsuit argues that Genesis has actually profited from the situation due to an appreciation of assets, particularly Bitcoin and Grayscale Bitcoin Trust shares, following the insolvency of Three Arrows Capital (TAC). DCG contends that because of the increased value of recovered collateral, its loan obligations to Genesis are effectively nullified. This legal action comes in response to a previous lawsuit filed by Genesis in May, seeking $3.1 billion, claiming that DCG and its CEO made fraudulent transfers while the lender was collapsing. Genesis had suffered business losses due to significant loans made to firms like Three Arrows Capital and Alameda Research during the cryptocurrency market downturn. The legal battle showcases the ongoing turmoil in the cryptocurrency lending sector and highlights disputes over financial obligations resulting from significant market shifts.

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