DCG and Genesis pay the price for 2022 missteps — a $38.5m fine from SEC

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Digital Currency Group and ex-Genesis CEO fined $38.5 cardinal by SEC for misleading investors.
This comes 18 months aft Genesis illness linked to Three Arrows default.

Digital Currency Group, founded by Barry Silbert and erstwhile Genesis Global Capital CEO Michael Moro, volition wage $38.5 cardinal to settee US Securities and Exchange Commission charges that it misled investors astir Genesis’s fiscal health.

The SEC announced the settlement connected Friday, stating that DCG and Moro “painted a misleadingly rosy picture” of the firm’s fiscal information pursuing the June 2022 illness of large borrower Three Arrows Capital.

This default compromised Genesis’s business, yet the institution downplayed the interaction successful nationalist statements.

Sanjay Wadhwa, acting manager of the SEC’s Division of Enforcement commented that “DCG and Moro fell short,” successful providing the indispensable transparency.

DCG did not admit oregon contradict the SEC’s findings.

Genesis, a erstwhile DCG subsidiary, filed for bankruptcy successful January 2023 with $3.4 cardinal successful creditor claims.

In August 2024, the steadfast completed restructuring and began distributing $4 cardinal successful assets to creditors.

Bitcoin holders recovered 51% of their claims, portion stablecoin creditors received afloat reimbursement.

The colony is portion of a question of crypto enforcement actions arsenic the Biden medication nears its end.

Regulators are aiming to clear dockets earlier a much crypto-friendly Trump administration takes office.