Digital Currency Group
|Digital Currency Group (DCG)|
|Headquarters||New York City, New York|
|Key People||Barry Silbert, Founder and CEO; Mark Murphy, COO; Lawrence Summers, Advisor|
|Products||Blockchain investment firm|
Founded by Barry Silbert in 2015 to invest in blockchain enterprises, Digital Currency Group (known as DCG) boasts a long list of investments in its portfolio. It is the parent company of Grayscale Investments, Genesis Trading, CoinDesk, an online digital asset-focused news service, and Foundry.
The first three subsidiaries became leading enterprises in their respective industries by 2020. Foundry, a bitcoin mining venture, was first established in the summer of 2020.
DCG was established as a company, rather than as an investment fund. It was built on the cryptocurrency trading operations of SecondMarket that were spun out of the company before SecondMarket founder and CEO Silbert's trading platform was sold to Nasdaq. Early investors in DGC included Bain Capital Ventures, Transamerica Ventures, FirstMark Capital, MasterCard, and New York Life.
In November of 2021, DCG raised $700 million in an investment round, the second-largest in the crypto sector at that time. The funding round valued the company at $10 billion and was led by SoftBank Group Corp. All the money raised went to the selling shareholders, and none sold their entire stake, DCG said. Silbert, who owned slightly less than 40% of the company at the time, didn’t sell any stock in the offering, DCG said.
DCG was one of the many crypto companies that got caught in the fallout from the 2022 collapse of FTX. FTX's implosion triggered a wave of redemption requests that overwhelmed DCG’s subsidiary Genesis Global Capital (GGC). GGC decided to freeze withdrawals in November 2022, which affected Gemini Earn, a service the Cameron Winklevoss's firm offered in which his customers lent out their crypto to GGC in exchange for an annual yield.
GGC was also heavily exposed to the collapse of the hedge fund Three Arrows Capital. As of January 2023, DCG owes Genesis roughly $1.68 billion, 65% in the form of a promissory note maturing in June 2032 and the rest in an intercompany loan that is due in May of 2023. Both were arranged in order to rescue GGC from the damage from the Three Arrows fallout, according to the Wall Street Journal.
- Barry Silbert Launches Digital Currency Group With Funding From Mastercard, Others. TechCrunch.
- Digital Currency Group Wants to Be Crypto’s Standard Oil. The Wall Street Journal.
- Gemini’s Cameron Winklevoss Slams Crypto Exec Barry Silbert Over Frozen Funds. Bloomberg.
- Cameron Winklevoss gives crypto baron Barry Silbert one week to come up with a $1 billion solution to make his Gemini customers whole. Fortune.