Due to financial difficulties at one company, Digital Currency Group (DCG), a private equity firm with stakes in more than 200 cryptocurrency projects, has suspended dividend payments. Digital Currency Group, whose Genesis Global Capital borrowing unit is trying to keep the company from going bankrupt, said it would stop paying quarterly dividends to keep cash on hand.<\/p>\n\n\n\n
In a letter forwarded to shareholders on January 17, the company said its main goal is to “strengthen our balance sheet by curbing operating expenses and keeping liquidity.” It has money problems because of the problems at its subsidiary, which is said to owe more than $3 billion to creditors. DCG is also thinking about selling some of the assets in its portfolio.<\/p>\n\n\n\n
On November 16, Genesis stopped allowing users to withdraw money. Due to this, on January 10, Cameron Winklevoss wrote an open letter to the board of DCG requesting that Barry Silbert be removed as CEO.<\/p>\n\n\n\n
Genesis’ problems became clear when, in response to the FTX scandal, it stopped customer withdrawals on November 16. It said that the “abnormal” withdrawals were caused by “extraordinary market turbulence.”<\/p>\n\n\n\n
Genesis disclosed it had about $175 million trapped on FTX on November 10, just under a week earlier. In response, DCG gave Genesis a $140 million relief equity investment to help Genesis with its cash flow problems.<\/p>\n\n\n\n