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Genesis discussed merger, public listing with Gemini

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Illustration: Brendan Lynch/Axios

Bankrupt crypto lender Genesis and parent company DCG floated the idea of a potential merger with Gemini months before their relationship publicly soured, a new filing in a New York court shows.

Why it's the BFD: The document makes clear that Genesis was on the verge of bankruptcy even before FTX's implosion.

Zoom in: "Good lunch with Cameron [Winklevoss]," DCG chief executive Barry Silbert wrote in an email dated Oct. 20, 2022. "He is intrigued about the idea of a closer partnership between Genesis/Gemini/DCG, including a potential merger of the companies."

  • "I put him on clear notice that the path we're on right now could lead to a Genesis bankruptcy," Silbert writes. (Genesis had been hit hard by the collapse of Three Arrows Capital.)
  • While Silbert submitted the idea of a commercial partnership, he emphasized to Gemini president Cameron Winklevoss that "joining forces is most exciting to me."
  • "Combined Gemini and Genesis would be a juggernaut and would be competitive with Coinbase and FTX," he wrote, adding that he believed Gemini would have significant benefits from joining the DCG umbrella.
  • Silbert also floated the idea of a public listing for the combined entity, following a $500 million to $1 billion fundraise.

What happened: Silbert wrote that Cameron planned to take the points to Gemini CEO Tyler Winklevoss.

  • A deal never materialized. Genesis ultimately filed for bankruptcy protection in January 2023, and Cameron Winklevoss publicly called for Silbert's removal from his DCG position.
  • Gemini sued Genesis months later seeking to recoup funds owed to its customers. It then sued Genesis again in a dispute over Grayscale's bitcoin trust shares.

The intrigue: The New York state attorney general sued Gemini, DCG and Genesis late last year, alleging fraud in their "Earn product."

Gemini has not responded to a request for comment.

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