Genesis
Litigation Oversight Committee (LOC)
Overseeing Litigation. Pursuing Accountability. Representing Creditors.
Bringing Forward the Facts
The LOC has filed two complaints, a critical step to bring long overdue accountability to one of the most significant cases of breaches of fiduciary duty, fraud, and preferential transfers in digital asset history.
Delaware Complaint
Filed against Genesis’s parent company, Digital Currency Group Inc. (“DCG”), its CEO Barry Silbert, former Genesis CEO Michael Moro, DCG advisor Ducera Partners LLC (“Ducera”), and its CEO Michael Kramer.
Asserts claims of breach of fiduciary duty, fraud, and unjust enrichment against Silbert and other DCG and Genesis executives for abuse of Genesis at the expense of Genesis and its creditors.
Bankruptcy Complaint
Filed against Genesis’s parent company, Digital Currency Group Inc. (“DCG”), its CEO Barry Silbert, former Genesis CEO Michael Moro, DCG advisor Ducera Partners LLC (“Ducera”), and its CEO Michael Kramer
Alleges that preferential and fraudlent transfers—often timed around market flashpoints including the collapses of Terra-Luna, 3AC, and FTX—were orchestrated while Genesis was insolvent, and insiders knew the business was on the brink of collapse.
Delaware Complaint Highlights
Breach of Fiduciary Duties & Control
“Silbert used Genesis to enrich himself and finance his broader cryptocurrency empire on off-market, unfair terms before overseeing its demise.” (paragraph 1)
DCG’s Alter Ego
“DCG’s compliant pawn, Genesis’s former ‘CEO’ Moro, unsurprisingly stood by and allowed DCG to pilfer Genesis; the Genesis employees who disagreed with Silbert or refused to do DCG’s bidding were terminated and faced Silbert’s influential wrath in the industry.” (paragraph 8)
Fraudulent Accounting Cover-Ups
“Silbert, Kraines, and Murphy orchestrated sham transactions at the end of the second and third quarters, when Genesis’s books closed, to deceive Genesis lenders into believing that DCG was providing liquidity and equity to Genesis.” (paragraph 277)
False Marketing Campaign
“These DCG-scripted falsehoods were designed to induce customers, counterparties, and lenders (including Bitvavo and those of Gemini) to keep their valuable crypto and fiat currencies on the Genesis platform and to continue depositing even more assets with Genesis.” (paragraph 12)
Failure to Implement Systemic Controls & Knowledge of Wrongdoing
“Genesis was severely undercapitalized, lacked reasonable risk management, and had no board of directors or independent management of its own." (paragraph 1)
Bankruptcy Complaint Highlights
“Insider Defendants typically initiated their transfers around watershed events in the cryptocurrency industry…when the Insider Defendants knew through their close relationship with Genesis that its business was on the brink of collapse.” (paragraph 1)
“Throughout the year prior to Genesis’s bankruptcy filing, DCG and Genesis falsely reassured customers that Genesis’s balance sheet was ‘strong’ and that it had a ‘ton of liquidity’ to try to stave off the inevitable run on the bank. Meanwhile, the Insider Defendants called their loans ahead of other creditors in aggregate amounts of USD and cryptocurrency worth over $1.2 billion as of March 31, 2025.” (paragraph 87)
“DCG and Barry Silbert worked to fend off a run on the bank at Genesis, falsely assuring Genesis’s customers that the business was ‘strong’ and had a ‘ton of liquidity.’” (paragraph 1)
