As per the Bloomberg report, the parent company of Grayscale and troubled crypto lender Genesis, Digital Currency Group (DCG), paused quarterly dividends to preserve liquidity.
DCG shared a letter to its shareholders noting “In response to the current market environment, DCG has been focused on strengthening our balance sheet by reducing operating expenses and preserving liquidity. As such, we have made the decision to suspend DCG’s quarterly dividend distribution until further notice.”
The troubled trading firm Genesis owned by DCG had to halt withdrawals after its lending arm was severely weakened by the implosion of FTX and the hedge fund Three Arrows Capital. Now DCG is suffering in the aftermath of all of these events.
Digital Currency Group is now under scrutiny regarding its internal transfers. The probe has also been joined by the U.S. Securities and Exchange Commission (SEC).
Recently, Gemini Co-founder Cameron Winklevoss wrote an open letter asking for the resignation of Barry Silbert as CEO of DCG. Winklevoss noted DCG hadn’t given Genesis actual funding to make up for the 3AC losses. Instead, DCG entered into a 10-year promissory note with Genesis at an interest rate of 1% – due in 2032.