Digital Currency Group (DCG), the parent firm of struggling cryptocurrency lender Genesis, is liquidating some of its holdings. Tron founder and Chinese crypto entrepreneur Justin Sun is prepared to invest $1 billion to acquire the network.
In a recent interview with Reuters, Sun – the founder of Tron – said, “Depending on DCG’s assessment of the situation,” he would be willing to spend up to $1 billion on the Digital Currency Group’s holdings.
Suspension Of Withdrawals
Genesis is a part of DCG, and its clients are owed about $3 billion. The company’s lending arm stopped withdrawals on November 16, citing “extreme market dislocation.” This happened after the cryptocurrency exchange FTX filed for bankruptcy.
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As such, Reuters required assistance in determining Sun’s financial status. DCG is a $50 billion asset management firm that is estimated to be worth $10 billion in 2021. Current estimates place Sun’s net worth anywhere from $250 million to $3 billion, depending on the consideration given to traditional assets and cryptocurrencies.
Recent events have seen Sun promise billions in rescue funding to the collapsed FTX, but he still needs to execute. Similarly, Sun announced support for Binance’s Industry Recovery Fund.
Despite numerous requests for comment on the recent events and Sun’s expressed interest, DCG remained silent.
DCG Might Sell Its Properties
Earlier this month, Genesis, a DCG subsidiary, said that it would be cutting its personnel by 30% as a result of the current economic situation. Companies associated with both Sun and DCG are facing difficulties right now.
In an open letter published early in 2023, Gemini co-founder and twins Cameron and Tyler Winklevoss demanded that Genesis refund its $900 million debt to Gemini Earn. Cameron then intensified the public spat by requesting that DCG CEO Barry Silbert be removed from his position.
As a result, Gemini Earn, a close partner of Genesis, ceased withdrawals and formally shut down on the same day as DCG’s subsidiary, which later officially became defunct on January 8th.
Although Silbert has tried to put some space between his company and Genesis’s problems, the company is reportedly considering selling assets to cover Genesis’s $3 billion debt. Genesis was one of the first companies to suffer from the FTX outbreak, freezing withdrawals from its lending platform in the middle of November.
Since then, it has come to light that the company considered filing for bankruptcy and hence retained restructuring advisers. Reports also suggest the company tried and failed to raise $1 billion in rescue funding, while a spokesman for the firm said those reports were out of date and that the firm had been engaged in “quite positive negotiations” as recently as late November.
At the time of writing, TRON TRXUSD is trading around $0.0635 which is 5.44% up.
Featured Image from Businessnews, Featured chart from Tradingview.com.