Digital Currency Group (DCG)

Digital Currency Group (DCG) is a U.S.-based conglomerate of 7 cryptocurrency-focused companies, including:

Genesis Trading – the world’s largest digital asset servicing institutional investors
Grayscale – the world’s largest digital asset manager
Coindesk – online publisher and platform for crypto media, news, events, and data
Foundry – operates the 2nd largest bitcoin mining pool in the world, offers a marketplace for buying and selling mining equipment in bulk, and provides logistical, financial, and educational support to crypto mining businesses
Luno – a crypto exchange and platform offering news, analysis, and education
TradeBlock – provides institutional tools and analytics
HQ – a digital currency job board

DCG’s mission is to incubate, acquire and operate businesses that provide financial and professional services to financial institutions, corporations, and startups.

DCG has invested in 200 crypto companies, including Acala Network, BitGo, BitPay, Blockchain, Blockstream, Chainalysis, Circle, Coinbase, Decentraland, Etherscan, eToro, Fireblocks, Foundry, FTX, Kraken, Ledger, Livepeer, Nomics, Paradigm, Ripple, ShapeShift, Silvergate, The Graph, Xapo, and Zcash.

DCG reached a valuation of US $10b in 2021 after a US $700m investment led by Softbank Group Corp.

3AC Loan, FTX Collapse, and Genesis Trading Bankruptcy

In late 2022, due to the collapse of FTX and a bad loan to bankrupted hedge fund Three Arrows Capital amounting to $2.4 billion, Genesis Trading took the extraordinary measure of stopping customer withdrawals in an effort to stave off a bank run on its cash reserves.

As a result of this measure and the weak cryptocurrency market landscape of the last year, Genesis failed to return $3.5b to over 100,000 of its customers. In January of 2023, Genesis filed for bankruptcy protection in an effort to get its finances in order. Gemini Trust Company, which operates the Gemini crypto exchange and is one of Genesis Trading’s largest customers, is still owed nearly $800m as of January 2023.

As of January 2023, Coindesk is potentially seeking new ownership and Luno cut 35% of its workforce.

To view DCG’s portfolio of companies, go here.

Related Terms

FTX

FTX is a centralized cryptocurrency exchange (CEX) headquartered in The Bahamas and founded by Sam Bankman-Fried and Gary Wang in 2019. On November 11th, 2022, FTX filed for Chapter 11 bankruptcy and appointed a new CEO, Jon Ray. Sam Bankman-Fried stepped down as CEO amid accusations of mishandling $10 billion in FTX customer funds by transferring them from the exchange to his hedge fund, Alameda Research, to help fund floundering operations.

Alameda Research

A crypto hedge fund trading firm started by FTX exchange founder and former CEO Sam Bankman-Fried (SBF) that was known for making huge bets on other crypto companies and businesses. Alamada Research was at the heart of the FTX liquidity crisis that resulted in both FTX and Alameda filing for Chapter 11 bankruptcy in November of 2022.

Caroline Ellison

A former math nerd and Standford University graduate, Ellison would go on to run billion-dollar cryptocurrency hedge fund Alameda Research as CEO. Recruited by Sam Bankman-Fried, Ellison was a member of the core team that ran both Alameda Research and FTX, the world’s 5th largest cryptocurrency and derivatives exchange before its Chapter 11 bankruptcy filing in November 2022.

Genesis Block

The very first block or first few blocks recorded on a blockchain or blockchain-based protocol. The genesis block is often called Block 0 or Block 1. The genesis block sets the foundation for the rest of the blocks that are added to form a chain of blocks. That’s where we get the word “blockchain”. The most famous genesis block, and the very first Bitcoin block, called the Genesis Block, was created on January 3rd, 2009, by Bitcoin’s infamous and mysterious creator, Satoshi Nakamoto. Some consider this date to be the start of the cryptocurrency revolution – the start of it all!

Sam Bankman-Fried (SBF)

At one point one of the richest people in crypto, Sam Bankman-Fried and cryptocurrency exchange FTX have come crashing down to earth in a matter of days following reporting that his Alameda Research hedge fund was undercapitalized and he allegedly took customer funds out of FTX illegally and funneled them to Alameda Research.