DCG Trying To Offload Its Venture-capital Portfolio Worth $500 Million

Key Points:

• Genesis’ parent company, Digital Currency Group, is considering asset sales to settle its over $3 billion debt to creditors.
• A portion of DCG’s venture capital portfolio, estimated to be worth $500 million, may be sold.
• Its portfolio includes the now-defunct FTX as well as cryptocurrency exchanges like Coinbase, Kraken, and Blockchain.com.

According to sources cited by the Financial Times on Thursday, the parent company of troubled cryptocurrency lender Genesis, Digital Currency Group (DCG), is considering asset sales to settle its over $3 billion debt with creditors.

After its Genesis company was caught off guard by the collapse of FTX in November, DCG, a conglomerate that owns investment manager Grayscale and crypto media portal CoinDesk, is looking to attract new funds.

According to the source, DCG is thinking about selling some of its venture-capital portfolio, which includes 200 cryptocurrency-related ventures, including exchanges, banks, and custodians in at least 35 countries, and is estimated to be worth $500 million. After Genesis halted withdrawals in the latter part of last year, DCG is making an effort to generate new funds through the sale.

Its portfolio includes the now-defunct FTX as well as cryptocurrency exchanges like Coinbase, Kraken, and Blockchain.com. The report also stated that because DCG’s assets are illiquid, it may take some time to sell them.

One of the biggest lenders in the cryptocurrency market was Genesis, a completely owned subsidiary of DCG, which offered consumers substantial profits in exchange for lending out their coins. After the collapse of FTX, it did, however, restrict customer withdrawals and cited extraordinary market instability as the reason.

According to two of the people acquainted with the situation, Genesis owes creditors more than $3 billion.

Genesis’s debts to creditors, the size of which have not yet been disclosed, highlight the difficulty of raising money for DCG, whose efforts to attract outside investment have so far failed as the company suffers in the wake of the failure of cryptocurrency exchange FTX. As a result of the Winklevoss twins’ cryptocurrency exchange Gemini using Genesis in its loan program, the group is also embroiled in a highly publicized legal battle with them.

The co-founder of Gemini, Cameron Winklevoss, has been demanding for the removal of DCG CEO Barry Silbert, and tensions between DCG and Genesis creditors have been running high.

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Harold

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