Emre Yumlu 
One of the prominent players in the crypto space, Genesis has filed two separate lawsuits against its parent company, Digital Currency Group (DCG) and CEO Barry Silbert. The court documents accuse the company of mismanagement during its bankruptcy process, insider enrichment, and deceptive transactions.
Allegations from Genesis: Funds Were Deliberately Transferred
According to the complaint made public by the Delaware Chancery Court on May 19, DCG allegedly treated Genesis like a “corporate ATM,” transferring millions of dollars for its own benefit.
In the filings prepared by Genesis’s Litigation Oversight Committee (LOC), it’s claimed that around $2.1 billion worth of digital assets were moved out of the company as it spiraled toward collapse. The remaining debt reportedly stands at approximately $2.2 billion, consisting of Bitcoin, Ethereum, and various other tokens.
Striking Details in the Lawsuit Documents
The documents also allege that $1.2 billion was withdrawn from Genesis before it filed for bankruptcy. Notably, these withdrawals occurred shortly after the collapses of Terra-Luna, 3AC, and FTX — raising concerns about timing and intent. Genesis claims that while insiders recovered all of their funds, retail and institutional investors suffered massive losses.
The lawsuit highlights that Genesis operated without an independent board, with major decisions shaped entirely to benefit DCG. Genesis was allegedly forced to accept illiquid GBTC shares as collateral and was barred from selling them, even after regulatory lockup periods ended — a move that created serious valuation risks for the company.
Who’s Being Accused?
In addition to Barry Silbert, the complaint names former Genesis CEO Michael Moro, former DCG CFO Michael Kraines, DCG President Mark Murphy, and investment advisor Ducera Partners as defendants.
A second lawsuit was filed in the U.S. Bankruptcy Court for the Southern District of New York, alleging that DCG and its affiliates withdrew $1.2 billion in cash and crypto during the 12 months leading up to Genesis’s bankruptcy.
A $3.3 Billion Claim for Compensation
Through these two lawsuits, Genesis is seeking to recover more than $3.3 billion. These legal actions underline how lack of transparency and poor governance can lead to devastating consequences in the crypto industry.
Meanwhile, in April 2025, a New York judge allowed most of another civil fraud case against DCG, Silbert, and former Genesis CEO Michael Moro to proceed. This case alleges that Genesis misled investors after the collapse of Three Arrows Capital, hiding a $1 billion hole with a 10-year, low-interest promissory note.
Genesis filed for bankruptcy in early 2023, with $14 billion in outstanding loans.
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