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- Barry Silbert is the CEO of Digital Currency Group, the crypto conglomerate that owns Genesis and Grayscale.
- Crypto lender Genesis halted loan redemptions and originations due to a liquidity crisis in November.
- Silbert is the eighth richest person in crypto, according to Forbes.
Barry Silbert’s Digital Currency Group looks like one of the last crypto empires still standing after FTX’s collapse last year.
In 2015, the 46 year old started Digital Currency Group (DCG), the $10 billion parent company that controls industry giants like crypto brokerage Genesis and digital asset manager Grayscale. The conglomerate also owns trade publication Coindesk, crypto mining firm Foundry Services, crypto index provider TradeBlock, and digital asset platform Luno Global.
Through its various subsidiaries, DCG has invested in more than 200 crypto startups.
DCG is facing headwinds with the rest of the industry, however, with reports surfacing of Genesis’ looming bankruptcy and a federal investigation into the crypto conglomerate.
“It’s bigger than almost anything else we could imagine,”James Malcolm, head of foreign exchange and crypto research at UBS Investment Bank, told Bloomberg. “Specific to the $10.6 billion Grayscale Bitcoin Trust, they are the biggest crypto fund, so any resolution that involves liquidation would be another major setback.”
For context, Genesis’ lending arm was hit earlier this year over its exposure to now-defunct fund Three Arrows Capital, and later revealed its derivatives business has $175 million lock on an FTX trading account. The firm just cut 30% of its staff last Thursday, a company spokesperson told Insider.
Genesis suspended new loan originations and withdrawals in November after FTX filed for bankruptcy. Gemini, the cryptocurrency exchange led by Cameron and Tyler Winklevoss which partnered with Genesis on interest-bearing products, had to halt withdrawals for Gemini Earn users as a result.
Cameron Winklevoss blasted Silbert for “bad faith” business practices last week, alleging the crypto baron owes the digital asset exchange’s customers $900 million. Silbert has refuted Winklevoss’ claims.
Silbert is the very public face of DCG, often opining on crypto markets through his Twitter feed and in interviews.
Prior to launching DCG, Silbert went to Emory University’s Goizueta Business School and began his career as an investment banker at Houlihan Lokey. He began investing in blockchain technology firms around 2013.
Later, he started and sold a financial services company called SecondMarket, which was later acquired by Nasdaq for an undisclosed amount in 2015.
Silbert had a net worth of $3.2 billion and was the eighth richest person in crypto as of April last year, according to Forbes, though that figure has likely been whittled down considerably amid the dramatic fall of digital asset prices in the second half of 2022.
Elsewhere, the Securities and Exchange Commission, along with US Attorney’s Office for the Eastern District of New York, are investigating DCG for internal transfers at Genesis, Bloomberg reported on Friday, citing unnamed sources.
“DCG has a strong culture of integrity and has always conducted its business lawfully. We have no knowledge of or reason to believe that there is any Eastern District of New York investigation into DCG,” a spokesperson told the news outlet.
DCG and Genesis declined to comment.