Digital Currency Group Announces the Shut Down of TradeBlock

Breanne Madigan, CEO of TradeBlock, a subsidiary of the Digital Currency Group, will shut down the company, and the process begins on May 31.

Troubled cryptocurrency conglomerate, Digital Currency Group (DCG), announced the closure of its prime brokerage division TradeBlock, citing the overall situation of the financial sector and the unpredictability of the legal landscape for cryptocurrencies in the US. 

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TradeBlock CEO to Begin Closure on May 31

Bloomberg reported on May 25 that Breanne Madigan, the CEO of TradeBlock, will formally start the process of closing down the company on May 31.

Bloomberg apparently received a statement from a representative saying: 

“Due to the state of the broader economy and prolonged crypto winter, along with the challenging regulatory environment for digital assets in the US, we made the decision to sunset the institutional trading platform side of the business.”

DoJ Investigating the Digital Currency Group

Recently, the group was set to be investigated by the US Department of Justice (DoJ) in collaboration with the office of the Eastern District of New York (ESDNY). Authorities were looking into potential “inducements and fraud” by the corporation and its affiliates.

Substantial Losses

After Genesis Global, its lending arm, suffered substantial losses as a result of the failure of the cryptocurrency hedge fund Three Arrows Capital (3AC) and the abrupt collapse of FTX, the firm eventually started to crumble. 

Following that, the platform was compelled to stop the withdrawal of consumer loans due to market turmoil. DCG now owes Genesis $575 million in intercompany loans that are due in May 2023.

Digital Currency Group Owes Money to Gemini

Digital Currency Group ultimately announced the closure of one of its wealth management companies, known as HQ Digital, after experiencing many financial difficulties.

It is important to look at the fact that a few days ago, Cameron Winklevoss, co-founder of Gemini Trust Company, LLC, provided the public with an update regarding its earn program, in which he stated that the company was planning on suing Digital Capital Group (DCG) and its CEO, Barry Silbert, for the $900 million owed to Gemini customers.

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