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Gemini Files Lawsuit Against Digital Currency Group and Barry Silbert Alleging Fraud and Deception

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Gemini Files Lawsuit Against Digital Currency Group and Barry Silbert Alleging Fraud and Deception

After Gemini co-founder Cameron Winklevoss published an open letter to Digital Currency Group (DCG) CEO and founder Barry Silbert, threatening legal action if the firm failed to respond by July 7, Winklevoss announced on Friday that his company had filed a lawsuit against DCG and Silbert in New York.

**Editor’s Note: This article was updated at 2:00 p.m. (ET) on Friday, July 7, 2023, with three additional paragraphs reflecting a statement from Digital Currency Group and a response to that statement from Gemini co-founder Tyler Winklevoss.

Gemini Proceeds With Lawsuit Against DCG and CEO Barry Silbert

Gemini has proceeded with the filing of a lawsuit against Barry Silbert and DCG regarding the purported losses resulting from DCG’s alleged decisions. In a cautionary open letter posted on Twitter last week, Cameron Winklevoss warned that legal action would ensue unless DCG accepted the “best and final offer.”

“When Gemini notified Genesis it would be terminating the Earn program in October 2022, Barry reached out to set up a meeting to induce Gemini to continue Earn. He did this knowing Genesis was massively insolvent,” Winklevoss tweeted sharing the lawsuit on Twitter. “Barry claimed that Genesis faced only a timing issue – a lie that hid the gaping hole on Genesis’s balance sheet,” the Gemini co-founder added.

Gemini Trust Company is listed as the plaintiff in the court filing, while Digital Currency Group and Barry Silbert are named as defendants. “This lawsuit seeks to recover from Defendants the damages and losses that Gemini has incurred as a direct result of DCG’s and Silbert’s false, misleading, and incomplete representations and omissions to Gemini, and Defendants’ role in encouraging and facilitating Genesis’s fraud against Gemini,” the filing alleges. The court filing further insists:

This lawsuit is about fraud. The assets involved—bitcoin and other cryptocurrencies—are relatively novel, but the fraud and deception committed by Defendants are all too familiar.

Digital Currency Group Responds to Lawsuit

While he retweeted a post on Twitter on July 3, Silbert has not made a statement on the platform since June 10, 2023. “DCG — and Barry personally – are direct participants in the fraud that has damaged Gemini and hundreds of thousands of Earn users. This complaint is an important step in holding them accountable for what they have done,” Winklevoss concluded in his Twitter thread. At 12:00 p.m. (ET) on Friday, DCG responded to the lawsuit.

“This is yet another publicity stunt from Cameron Winklevoss to deflect blame and responsibility from himself and Gemini, which operated the Gemini Earn program. Any suggestion of wrongdoing by DCG or any of its employees is baseless, defamatory, and completely false,” the company stated in a shared message on Twitter. “From day one, DCG has remained committed to reaching an amicable solution for all parties to the Genesis bankruptcy.”

“Senior DCG leadership has been working around the clock over the course of multiple months in active negotiation with representatives of the Official Unsecured Creditors Committee and Ad Hoc Committee to reach a deal while Gemini’s leadership was MIA or only issuing press statements,” DCG added in its defense. “To be clear, neither Cameron nor Tyler Winklevoss have been involved in any of the recent in-person meetings. The mediation process is nearing a close and we expect to bring the Genesis Chapter 11 case to a conclusion soon.”

Tyler Winklevoss also replied to DCG’s statement. “[DCG and Silbert] fail to address or deny a single assertion in our 33-page complaint,” Tyler Winklevoss said in response to DCG’s statement on Friday. “Exactly which parts are ‘baseless, defamatory, and completely false?’ The indisputable fact is that DCG and Barry were directly involved in misleading creditors as to the financial condition of Genesis.”

What are your thoughts on the lawsuit filed by Gemini against Digital Currency Group and Barry Silbert? Share your thoughts and opinions about this subject in the comments section below.

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