Genesis owner Digital Currency Group shuts down wealth management subsidiary
Digital Currency Group (DCG) to close wealth management subsidiary HQ Digital, reports The Information January 5thciting internal notes.
According to reports, HQ Digital ceased operations on January 2nd. It was launched in June 2022 and has been in operation for over half a year.
The article’s author, Kate Clark, later issued a statement A DCG spokesperson said HQ Digital will be shutting down due to the “broader economic environment” and “extending crypto winter.”
The spokesperson also said DCG may revive the subsidiary in the future.
The original report referred to HQ Digital as “FTX implosion collateral damage,” possibly referring to problems with another DGC subsidiary, Genesis Global Capital.
Genesis suspended withdrawals and loan redemptions after FTX collapsed in November. The decision also affected Gemini Earn, an interest-bearing service offered in partnership with cryptocurrency exchange Gemini.
On January 5th, Genesis laid off 30% of its staff. This is due to reports that the company is considering the possibility of filing for bankruptcy.
Genesis denies any exposure to FTX’s FTT token and states that it has no lending relationship with FTX. However, he does admit to having $175 million in FTX.
DCG also owns a number of crypto companies, including news site CoinDesk, asset management firm Grayscale, mining and advisory firm Foundry, crypto wallet company Luno, and institutional trading API service TradeBlock.
Of these companies, only Luno has been affected so far, discontinuing its interest-bearing wallet in November. It is not yet known if other subsidiaries are at risk.
