Attorney's Office for the Eastern District of New York inquired specifically about Silbert's conduct. According to the Bloomberg report, the U.S. DCG had denied the allegations and in August urged a U.S. Gemini in July sued DCG and its CEO, the day after DCG missed the exchange's deadline for agreeing to a restructuring deal for the venture capital firm's troubled unit. The co-founders of Gemini in July filed a suit accusing Silbert and Genesis of misleading investors, and claims it used accounting tricks to try to cover up a hole in the parent company's balance sheet. Silbert's Genesis filed for bankruptcy in January after making some risky bets and still owes creditors, including Gemini, over $3 billion, according to court filings. The Winklevoss twins and crypto baron Silbert have been feuding since Genesis, a unit of DCG, froze withdrawals last November in a blow to its largest creditor, Gemini. SEC staff sat in on an interview in recent months with Cameron, who co-founded crypto exchange Gemini with his twin Tyler, the report said. Prosecutors in Brooklyn, FBI agents, and U.S. agencies are investigating allegations of fraud leveled by billionaire Cameron Winklevoss against Digital Currency Group (DCG) and its CEO Barry Silbert, Bloomberg News reported on Thursday, citing people familiar with the matter. They said they still hope to launch a derivatives product in the U.S.Winklevoss claims fuel US probe of DCG crypto business - Bloomberg NewsįILE PHOTO: Cameron Winklevoss speaks at a New York State Department of Financial Services (DFS) virtual currency hearing in the Manhattan borough of New York January 28, 2014. “It’s unfortunate that they’re optimizing for political points instead of helping us advance the cause of 340,000 Earn users and other creditors,” he continued.įor the Winklevoss twins, the offshore exchange-the first Gemini product focused outside the U.S.-signals a new stage for the firm, which they founded in 2014. In a tweet after the SEC’s lawsuit, Tyler Winklevoss expressed disappointment about the action, writing: “Their behavior is totally counterproductive.” The two companies are currently embroiled in negotiations after Genesis declared bankruptcy in January. The arrangement between the two firms developed as Crypto Winter worsened, with Genesis blocking Gemini investors from withdrawing assets after it lost significant capital in the wake of FTX’s collapse. Under the program, users could earn a yield by loaning crypto assets to Gemini through the Digital Currency Group–run entity Genesis. In January, the Securities and Exchange Commission charged Gemini with the unregistered offer and sale of securities through its Gemini Earn lending service.

We look forward to definitively proving this in court,” the firm said in a statement at the time.

“We have an eight-year track record of asking for permission, not forgiveness, and always doing the right thing. In June 2022, the CFTC sued Gemini, alleging that it made “false and misleading statements” in its efforts to launch the first U.S.-regulated Bitcoin futures contract in 2017-a separate process from its 2020 application with the agency to launch a derivatives exchange. The brothers pointed to New York as an example of a jurisdiction that had created a regulatory framework by offering trust charters and BitLicenses to digital assets companies and subsequently attracted firms to operate in the state.ĭespite its compliance efforts, Gemini has run into operational challenges in the U.S. “We are gluttons for thoughtful regulation and licensing,” Cameron Winklevoss told Fortune. regulators, including receiving a trust charter from the New York Department of Financial Services in 2015. The service is targeted at both retail and institutional traders and will exclude the U.K. By launching outside the U.S., Gemini’s new platform allows users to trade Bitcoin perpetual contracts with up to 100x leverage, or the amount they can multiply their exposure, with plans to also launch Ether perpetuals in the coming weeks. Tyler Winklevoss described derivatives as an important offering for marketplaces, as they allow users to hedge and manage risk. Some crypto platforms, like Binance, have a special U.S. Because crypto derivatives trading is highly restricted in the U.S., exchanges focus on spot markets, or trading on the current price of assets.

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