Grayscale Investments close to bankruptcy

The representative of the analytical company Reflexivity Research, Will Clemente , today on his Twitter account announced the lack of liquidity of the Digital Currency Group. Their cryptocurrency assets, which included the coins of Filecoin, Flow, Stacks, Livepeer, Ethereum Classic, Decentraland (MANA) and others, have been actively sold in the last 24 hours.

This indicates that the subsidiaries of the Digital Currency Group are in big trouble and close to collapse. These entities include Genesis and Grayscale Investments. We talked about the likelihood of such an unpleasant set of circumstances for the above-mentioned companies earlier.

Additional facts pointing to the extremely difficult situation of the Digital Currency Group and their active actions to combat debts was a recent statement by representatives of Bitvavo Custody BV. The company, which belongs to the Bitvavo cryptocurrency exchange, has notified everyone on its blog about the lost access to its funds in the amount of €280,000,000.

Digital Currency Group is preventing Bitvavo Custody BV from withdrawing its funds due to insufficient liquidity of the available funds. For this reason, they stopped payments to their clients until they notify users of the opportunity to withdraw their funds to users.

Andrew Parish, one of the founders of the ArchPublic cryptocurrency platform, which develops Web3 technologies, also spoke about the situation with the Digital Currency Group. According to Parish, claims from Genesis creditors are now being sold little by little in the shadow markets.

Andrew also clarified that 35% of two $15,000,000 trades were closed recently before the withdrawal was suspended.

Crypto industry marketing and analytics specialist Adam Cochran commented on Parish's statements, confirming the early stage of bankruptcy of the Digital Currency Group if what the founder of ArchPublic said is true.

Genesis and Grayscale Investments, subsidiaries of the Digital Currency Group, are the first to be hit in this case, since the latter, in an attempt to avoid insolvency, will sell all their assets and get rid of their companies represented by Genesis and Grayscale Investments.

The bankruptcy of FTX had a strong impact on the situation of the Digital Currency Group. DCG cash was held primarily on a US-based cryptocurrency exchange.

The FTX situation has doomed many cryptocurrency platforms to face unsolvable problems. Venues from various cryptocurrency sectors reported that they had large unpaid debts, and all the funds were lost due to the fact that they were stored on FTX.

2022 has been a merciless year for cryptocurrency investors. Due to the crypto winter and the collapse of many companies, many investors closed this year with huge losses. During this year, we have experienced the bankruptcy of Terra (LUNA), Three Arrows Capital, FTX, Celsius Network, Voyager and others. There are many more closures ahead, which we will be watching shortly.