King of Crypto Accused of Defrauding 340K Crypto Investors

• Barry Silbert, CEO of the Digital Currency Group, has been accused by Cameron Winklevoss of scamming 340,000 crypto investors using the Gemini Earn product.
• The accusation follows the suspension of customer withdrawals by Genesis Global Trading, a wholly owned lending company of DCG.
• DCG has denied the accusation, claiming it is yet another “desperate and unproductive publicity attempt” by Winklevoss.

Barry Silbert, the CEO of the Digital Currency Group (DCG), has come under fire from Cameron Winklevoss, the CEO of cryptocurrency exchange Gemini. In a scathing open letter posted to Twitter Tuesday morning, Winklevoss accused Silbert and his businesses of defrauding some 340,000 crypto investors using Gemini Earn.

The accusation comes after the suspension of customer withdrawals by Genesis Global Trading, a wholly owned lending company of DCG. Gemini had collaborated with Genesis for its “Gemini Earn” product, which promised investors yearly interest rates of up to 8%. According to Winklevoss, Silbert and his businesses “conspired to make false claims and misrepresentations regarding the stability and financial health of Genesis” in order to “buy time to escape the hole they dug for themselves by lying.”

In response, a DCG representative issued the following comment in an email to the publication Forbes: “This is yet another desperate and unproductive publicity attempt from Cameron Winklevoss to shift criticism from himself and Gemini, who are exclusively responsible for running Gemini Earn.”

Silbert, who is known as the “King of Crypto”, is a former billionaire whose wealth was derived from a massive stake in Bitcoin. He has since sold off most of his holdings and is currently worth around $400 million. He has been accused of unethical business practices in the past, including inflating the prices of cryptocurrencies to benefit DCG’s portfolio companies.

The latest accusation comes at a difficult time for Silbert, whose firm has seen its value drop by nearly 40% since the start of 2021. The company is facing pressure from investors to cut costs and lay off employees in order to stay afloat. If the accusations are proven to be true, it could have serious legal and financial ramifications for DCG and its affiliates.

Regardless of the outcome of the investigation, this situation is yet another example of the volatility and opacity of the crypto markets, and a reminder of the need for greater transparency and regulation in the industry. It remains to be seen how this situation will be resolved, but it is certain that this is not the last we will hear of it.