Barry Silbert, the founder of crypto conglomerate Digital Currency Group, is grappling with the collateral damage caused by the surprising downfall of crypto behemoth FTX.
In a note to shareholders on Tuesday, Silbert addressed all the “noise” about the financial health of DCG’s subsidiaries, which include trading firm Genesis, Grayscale Investments, and mining company Foundry.
“We have weathered previous crypto winters,” Silbert wrote, adding that “while this one may feel more severe, collectively, we will come out of it stronger.”
Specific to DCG, investor confidence took a hit in the last week when the Wall Street Journal reported that Genesis sought a $1 billion bailout from investors before ultimately halting some withdrawals. There were reports that Genesis would soon file for bankruptcy, which the company publicly refuted.
DCG’s debts amount to just over $2 billion. The company loaned Genesis roughly $575 million, priced at “prevailing market interest rates,” which is due in May 2023. It also absorbed the $1.1 billion debt that the bankrupt crypto hedge fund Three Arrows Capital owed Genesis.