Genesis Files Lawsuit Against Parent Company DCG Over $1.2 Billion Fund Transfer

Uk Jin

Summary

The lawsuit filed by Genesis against its parent company DCG involves a $1.2 billion fund transfer.
Genesis claims that DCG and its affiliates received a total of $1.2 billion, including $582 million in cryptocurrencies.
This situation coincided with the collapse of the cryptocurrency market, including Terra-Luna, Three Arrows Capital, and FTX.

The bankrupt cryptocurrency lending company Genesis has filed a lawsuit against its parent company, Digital Currency Group (DCG).

According to Bloomberg Law on the 19th (local time), Genesis submitted a complaint to the Southern District of New York Bankruptcy Court, claiming that it transferred cryptocurrencies to DCG and its affiliates a year before its bankruptcy.

Genesis claims that the amount transferred to DCG and its affiliates totaled $1.2 billion, including $582 million in cryptocurrencies. DCG headquarters took the largest amount at $448 million, followed by DCG International ($136 million) and HQ Yield Fund ($101 million).

In the complaint, Genesis emphasized, "DCG spread false information to customers, claiming safety, despite being aware of Genesis's severely deteriorated financial condition," adding, "DCG and insiders were also stakeholders who had lent hundreds of millions of dollars to Genesis and would suffer losses if Genesis went bankrupt."

Genesis also noted that "the timing of DCG's asset transfer coincided with the collapse of the cryptocurrency industry, including the Terra-Luna incident, Three Arrows Capital collapse, and FTX bankruptcy."