New York Judge Passes NYAG’s Lawsuit Against DCG For Trial

Digital Currency Group (DCG), its CEO Barry Silbert, and Michael Moro, the former CEO of Genesis Global Capital, may finally go to trial in a long-drawn legal battle 

DCG and Genesis Blames 3AC Collapse for Chaos

On Friday, a New York judge ruled that most of New York Attorney General Letitia James’ civil securities fraud suit against the crypto venture firm and the other entities can proceed to trial. 

It has been almost two years since the NYAG sued DCG, Silbert, DCG’s now-bankrupt lending arm Genesis Global Capital, Moro, and crypto exchange Gemini, alleging they worked together to cover a $1 billion hole in Genesis’ balance sheet. 

This financial crisis was allegedly caused by the wipeout of Singapore-based crypto hedge fund Three Arrows Capital (3AC) in 2022. She later expanded the lawsuit against the three companies and their affiliates about a year ago. 

According to James, both Digital Currency Group and Genesis falsely assured their users on social media that DCG had absorbed Genesis’ losses from 3AC’s implosion.

DCG And Genesis Fails to Fulfil Promissory Note Contract 

DCG and Genesis were lying to investors and defrauding them out of billions. The truth of the matter was that they only covered up the hole with a promissory note. 

They pleaded to pay Genesis $1.1 billion over 10 years at a 1% interest rate. During all this time, DCG has “never made a single payment under the Note.” Still, it didn’t stop claiming that the promissory note was legitimate. 

On the other hand, Gemini and Genesis settled with the OAG while the company, Silbert and Moro, continued to contend with them.

SEC Sues Digital Currency Group and Moro 

In January 2025, the United States Securities and Exchange Commission (SEC) charged DCG and Moro with misleading investors about Genesis Trading’s financial health status in the aftermath of the 3AC collapse. 

Consequently, they were asked to pay up to $38.5 million in civil penalties, with DCG responsible for a larger percentage of this fine.

Both Digital Currency Group and Moro settled with the agency without admitting to or denying the violations of the Securities Act of 1933. This marked a critical chapter in unraveling the 3AC saga that shook the crypto world to its core.