Digital currency group files motion to dismiss $3B NYAG lawsuit
Venture capitalist Digital Currency Group (DCG) and its CEO Barry Silbert have filed a motion to dismiss a $3 billion lawsuit filed by the New York Attorney General's Office (NYAG).
In October 2023, the NYAG filed charges against crypto companies Gemini, Genesis, and DCG for defrauding 230,000 investors, including 29,000 New Yorkers, in the Gemini Earn investment program. The NYAG claims the companies defrauded New Yorkers and lied about the investment program.
On February 8, DCG's subsidiary Genesis settled with NYAG. However, just one day later, the NYAG filed a new and expanded complaint against DCG and included Genesis as one of the defendants. Following the filing, DCG filed an objection to the February 21 settlement between Genesis and NYAG.
On March 6, DCG and Silbert issued a statement denying the allegations from the NYAG. DCG and Silbert also filed a motion to dismiss the lawsuit.
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DCG believes the facts will show the company “did nothing wrong” if the case goes ahead. He also said that DCG followed the advice of many experts and worked with “the best names”. He explained.
“In search of a headline-worthy scapegoat for the loss of others, the NYAG falsely seeks to demonstrate that DCG's good faith endorsement of Genesis is complicit in fraud.”
DCG also countered the NYAG's allegations against the company that they had created liquidity problems. The venture capital firm said it has invested hundreds of millions into Genesis since the collapse of Three Arrows Capital (3AC). DCG said this is a binding obligation that has been approved and endorsed by consultants, accountants and the company's board of directors in addition to the $1.1 billion promissory note.
“We will continue to vigorously fight these claims and look forward to putting this matter behind us as we focus on the broad growth opportunity for our industry in 2024 and beyond,” the DCG added.
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