. DOJ and SEC Investigate Digital Currency Group, Genesis Global Capital
• Digital Currency Group (DCG) is reportedly under investigation by the US Department of Justice and the Securities and Exchange Commission (SEC).
• The investigation is looking into internal transfers between DCG and its subsidiary crypto lending firm Genesis Global Capital.
• Neither US agency has provided any information about the case, and neither DCG nor Genesis has been indicted yet.
Digital Currency Group (DCG) is currently under investigation by the US Department of Justice and the Securities and Exchange Commission (SEC), according to a report by Bloomberg. The investigation is reportedly looking into internal transfers between DCG and its subsidiary crypto lending firm Genesis Global Capital.
The investigation is being conducted by the US Department of Justice’s Eastern District of New York and the SEC. Prosecutors have already requested interviews and documents from both companies, while the SEC is running a similar early-stage inquiry.
The investigation comes in the wake of the FTX trading account collapse in November, which affected Genesis Global Capital. Genesis had $175 million locked up in the FTX trading account, causing liquidity issues that led the firm to halt withdrawals on Nov. 16. The company has since engaged with investment bank Moelis & Company to assist with restructuring.
Neither US agency has so far provided any information about the case, and neither DCG nor Genesis has yet been indicted. A spokesperson for DCG said the company was unaware of any investigation, stating that they have a „strong culture of integrity and have always conducted their business lawfully.“
The investigation into DCG and Genesis Global Capital could have significant implications for the cryptocurrency industry, as DCG is one of the most prominent players in the space. DCG has investments in over 150 companies, and its portfolio includes some of the most well-known crypto projects, such as Coinbase, Circle, and Ripple. It remains to be seen how this investigation will affect the cryptocurrency industry, and if any charges will be brought against DCG or its subsidiary.