Genesis Sues DCG, Seeks $3.3 Billion in Fraudulent Transfers

Crypto lender Genesis and its subsidiaries have taken legal action against its parent company, Digital Currency Group (DCG), DCG CEO Barry Silbert, and other executives. The lawsuits, filed in Delaware and New York, aim to recover what Genesis alleges are fraudulent transfers of crypto worth billions of dollars.

In the Delaware suit, Genesis is seeking to recover $2.2 billion. This includes crypto assets such as bitcoin and ether, which are valued at approximately $2.2 billion. The New York filing alleges that money was withdrawn from Genesis to repay DCG, Silbert, affiliates, and other insiders in the year leading up to Genesis filing for Chapter 11, despite the company being insolvent. The suit claims that these individuals knew about Genesis's financial struggles and took advantage of the situation to withdraw their assets, recovering 100% of their crypto and dollar loans while keeping the public in the dark.

Genesis suspended withdrawals in November 2022 and filed for bankruptcy the following year. The Delaware filing alleges that Silbert and his associates recklessly operated, exploited, and ultimately bankrupted Genesis through a campaign of fraud and self-dealing. Alongside seeking damages, Genesis is requesting an equitable trust over any assets that the defendants improperly took or converted during their tenure as managers, officers, or directors.

DCG has responded to the lawsuits, stating that they are baseless and recycle old claims. The company claims that it worked in good faith with stakeholders to achieve a comprehensive resolution of the DCG-related aspects of the Genesis bankruptcy and will vigorously defend itself against these claims.

The lawsuits allege that DCG used Genesis as a corporate ATM, draining funds through self-serving loans and concealed transfers while presenting a false image of financial health. Through their court-appointed Litigation Oversight Committee (LOC), Genesis creditors claim that over a million digital coins, worth about $2.1 billion, were funneled away as Genesis edged toward collapse. The lawsuit names DCG, Barry Silbert, former Genesis CEO Michael Moro, former DCG chief financial officer Michael Kraines, DCG President Mark Murphy, and DCG’s investment banker Ducera Partners as defendants.

The second complaint, filed in the US Bankruptcy Court for the Southern District of New York, alleges that DCG and its affiliates withdrew over $1.2 billion in US dollars and cryptocurrencies during the year leading up to Genesis’s bankruptcy. These withdrawals were timed around major market events such as the collapses of Terra-Luna, Three Arrows Capital, and FTX — moments when Genesis was already insolvent. Genesis seeks to recover more than $3.3 billion through the two lawsuits.

In April 2025, a New York judge ruled that most of the New York Attorney General’s civil fraud lawsuit against DCG, Silbert, and former Genesis CEO Michael Moro can move forward. The suit accuses DCG and its bankrupt lending arm Genesis of misleading investors after the collapse of crypto hedge fund Three Arrows Capital, allegedly masking a $1 billion shortfall with a 10-year, low-interest promissory note. While Gemini and Genesis have settled, DCG and the executives have fought the charges.