Today, Gemini co-founder Cameron Winklevoss, on behalf of more than 340,000 users of its Earn product, sent an open letter to DCG founder Barry Silbert demanding that he repay over $900 million owed. Winklevoss accused Barry Silbert of refusing to cooperate over the past six weeks and engaging in malicious delaying tactics.
Barry Silbert, founder of DCG, responded to this, saying that "DCG did not borrow $1.675 billion from Genesis. DCG has never defaulted on Genesis' interest and is currently repaying all outstanding loans; the next loan is due in May 2023." DCG submitted a proposal to Genesis and your advisors on December 29, but has not received any response.”
Odaily translated the Cameron Winklevoss open letter:
Today marks the 47th day that Genesis has stopped withdrawals. I'm writing to you on behalf of over 340,000 Earn users who are looking for answers. These users aren't just numbers on a spreadsheet, they're real people: a single mom who lent you money for her son's education, a father who lent you money for his son's bar mitzvah, a couple A couple who lent you their savings, a teacher who lent you their child's college tuition, a police officer, and more. Together, these people entrusted you with over $900 million in assets, and they deserve specific answers, and I'm here to get those answers.
Over the past six weeks, we have done everything we can to engage with you in a genuine and cooperative manner to reach a mutual agreement settlement that will allow you to pay back the $900 million you owe while helping you retain your Business. We understand that any restructuring has start-up costs and that sometimes things don't move as quickly as we'd like.
However, it is becoming increasingly clear that you have been engaging in vicious delaying tactics.
For example, on December 2nd we expressed our belief that"Sitting in a room with everyone will be the most effective way to reach a resolution". You agreed, but said it would only be so after a proposal. On December 17th, a proposal was sent to you. An updated version of the proposal was delivered to you on Christmas Day, December 25th. Despite this, you still refuse to be in the room with us and discuss a solution. Additionally, you continue to refuse to agree to a timeline with key milestones. You hide behind lawyers, investment bankers, and processes whenever we ask you to actually participate. Six weeks later, your behavior is not only completely unacceptable, it is unconscionable.
The thought in your head is - you can hide quietly in your ivory tower and it will all magically disappear, or, it will be someone else's problem. This is pure fantasy. To put it bluntly, this mess is entirely of your own making. Digital Currency Group (DCG) - you are the founder and CEO - owes Genesis (its wholly owned subsidiary) approximately $1.675 billion. This is money Genesis owes Earn users and other creditors. You take that money—teachers’ money—to fuel greedy stock buybacks, illiquid VCs, and kamikaze-style grayscale NAV trades that make your fund generate fee-based assets under management (Fee -GeneratingAUM) rapid expansion. All this at the expense of creditors, all for your own personal gain. Now is the time for you to take responsibility and do the right thing.
We will not forget that you began your career as a bankruptcy and restructuring attorney. We also don't forget that you've been working hard trying to isolate DC from the problems you created at Genesis. You should dismiss this fantasy, because we all know what you know - DCG and Genesis don't mix. Everyone is at your beck and call and always has been. And any pretense you do after the fact is untenable. If you put all this energy into finding a solution, we'd all be done by now.
That's it for now. Everyone will be in a better place, including you.
According to previous reports, Cameron Winklevoss tweeted that Houlihan Lokey proposed a plan on behalf of the creditor committee to solve the liquidity problems of Genesis and DCG and provide a way for asset recovery. The plan is based on information received to date from Genesis, DCG and their respective advisors.
