In response to the U.S. Securities and Exchange Commission’s charges against crypto exchange Gemini and digital currency lender Genesis, Tron founder Justin Sun “told the press that, depending on an assessment of the situation, up to $1 billion in may be able to purchase assets from Genesis, he told the press.” Depending on their assessment. Additionally, crypto investment manager Osprey issued an open letter to Barry Silbert of the Digital Currency Group to take over management of Grayscale’s Bitcoin Trust (GBTC).
Osprey proposes management changes to Grayscale’s Bitcoin Trust in an open letter to Digital Currency Group
On January 12, 2023, the U.S. Securities and Exchange Commission (SEC) filed charges against crypto exchange Gemini and crypto lender Genesis Global Capital. Crypto lender Genesis Global Capital is a subsidiary of Digital Currency Group (DCG). Regulators allege that the two organizations participated in an “unregistered offering.”
The SEC said that nearly three years ago, Gemini and Genesis “gave investors the opportunity to finance crypto assets in exchange for Genesis’ promise to pay interest. “The SEC’s accusations are based on two letters written by Gemini co-founder Cameron Winklevoss (Letter 1 and Letter 2) and followed a recent shareholder letter in which Silbert denied the accusations.
The next day, crypto investment managerOspreypublished anopen letterto Barry Silbert, CEO of Digital Currency Group (DCG), in which Osprey stated that the fund “believes that Osprey is at this time the best position to manage GBTC as a wants to take over the Grayscale Bitcoin Trust (GBTC) because they believe it is “the third party best positioned to manage it. “DCG is Grayscale’s parent company, and Osprey is the first digital currency to offer help fund, but Tennessee crypto asset manager Valkyrie Investments is also vying to take over GBTC; like Osprey, Valkyrie has issued an open letter to DCG, stating that it is “uniquely qualified” for the role.
In that letter, Osprey detailed several things he would change related to the Bitcoin Trust if he were to take over the management of GBTC.” We would reduce the management fee to 0.49% and clean up the fund’s expense structure, including significant conflicts of interest,” Osprey said Friday.” We would also seek to implement a redemption program as soon as possible.” The digital currency fund manager added
We would pursue an immediate listing on the NYSE, but from a position of cooperation with regulators. For example, we will not file any lawsuit against the SEC, but instead will work directly with Congress to educate the SEC on the rationale for approving the Fund as an exchange-listed ETP.
We believe the company is reaching out to demonstrate its ongoing commitment to its shareholders. Osprey insists that DCG and Silbert should be allowed to acquire the fund as soon as possible.” Osprey stated, “We request that the Osprey Funds be installed as a sponsor of GBTC immediately to protect GBTC’s holders and to give confidence to non-DCG related stakeholders of GBTC and Grayscale who have an interest in preserving value.
Tron’s Justin Sun proposes to invest $1 billion in the Digital Currency Group’s assets in the SEC’s complaint against Gemini and Genesis
Meanwhile, Tron’s Justin Suntold Reutersthat he, too, is willing to lend a hand; Sun said he would consider investing $1 billion in Digital Currency Group’s (DCG) assets, but that it would depend on an “assessment of the situation.” . Sun also offered to help FTX the day before FTX files for bankruptcy on November 11, 2022.
At the time, Sun saidthat his team was working around the clock to alleviate the FTX situation and that he was taking steps to helpFTX. However, neither promise materialized, and the next day FTX filed for Chapter 11 bankruptcy and Sam Bankman-Fried stepped down as CEO.
It is unclear whether Digital Currency Group (DCG) or Genesis will accept help from organizations or individuals within the crypto industry. The company did not respond to Valkyrie’s attempt to sponsor GBTC through Grayscale in the first week of the New Year.
Additionally, Grayscale is involved in an ongoing legal disputewith the SECover its denial of GBTC being converted into an exchange traded fund (ETF). Grayscale believes that if the SEC allows GBTC to be converted into an ETF, it will be possible to issue and redeem shares of the Bitcoin Trust. Grayscale greatly criticizedthe Commission’s reasoning,stressing that the U.S. regulator’s “central premise is illogical.”
What do you think about the ongoing legal disputes and potential management changes proposed by Osprey and Tron’s Justin Sun investment offer? Do you believe it is a step in the right direction for the crypto industry or could it lead to more complications