Digital Currency Group (DCG) has initiated legal action against its subsidiary, Genesis, claiming that a $1.1 billion loan provided to the struggling crypto lender was sufficient to cover its losses from a collapse that began in 2022. Following its insolvency, Genesis had borrowed extensively, primarily from loans supporting firms like Three Arrows Capital, which faced defaults during the market downturn. In a subsequent lawsuit, Genesis accused DCG of making fraudulent transfers during its crisis, seeking $3.1 billion in damages. DCG's lawsuit argues that the loan's value has far surpassed Genesis's needs, as the value of assets recovered from Three Arrows Capital has increased. DCG asserts that due to the significant rise in cryptocurrency values, Genesis has actually seen profits from its situation, which should negate any claims of loss. DCG seeks court confirmation that it has fulfilled its obligations under the loan agreement with Genesis, stating that despite assisting the subsidiary, the legal move is a step to clarify financial responsibilities and recoveries in light of market changes.

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