DCG Closes Crypto Trading to TradeBlock Institute

DCG Closes Crypto Trading to TradeBlock Institute

Digital asset group The Currency Group (DCG) is reportedly shutting down its crypto trading operations for its institutional clients, namely TradeBlock. This will take place on May 31. Vague regulations as well as the long crypto winter are accused of being the main reason for the company to stop its digital asset trading for corporate clients.

TradeBlock itself is not a company founded by DCG from scratch. The company entered the DCG ecosystem through the acquisition of Coindesk, a media company owned by Digital Currency Group, in 2020.

Taken as a whole, DCG is indeed facing significant financial pressure. Why not, while the litigation between their business organization and Gemini is not over, they still have to face external pressures, such as tight regulations and crypto price volatility. These various pressures ultimately made it more difficult for DCG’s business to operate.

“Due to the growth of the economic environment as well as the challenge of the regulatory environment in the United States (USA), the company has decided to stop platforms institutional business” clearly DCG spokesperson.

Apart from that, financial pressure was also felt when DCG failed to pay its obligations platforms Gemini crypto. They have a debt of 630 million US dollars which is due in the second week of May.

DCG Closes Wealth Business Unit at Start of Year

This is not the first time that DCG has closed its business services. At the beginning of this year, the company led by Barry Silbert was also already closed Division of property. In fact, the business unit known as HQ is one of the company’s main sources of income, apart from Grayscale and Coindesk.

In the case, the company also blamed the environment and the bad economic situation crypto winter which is still going on. But unfortunately, neither TradeBlock nor HQ gave a clear statement about the reasons and steps to take after the business was suspended.

Looking inside the company, DCG’s financial condition is also not in good shape. Last year, the company reported a loss of US$1.1 billion. The Three Arrows Capital (3AC) disclosure by Alameda Research was used as a way to get big losses in 2022.

Some suspect that DCG will go bankrupt. The liquidity crisis and its subsidiary conflicts will be the main reason. Additionally, the company has also divested several business entities that have so far yielded significant profits.

One of them is the action of selling shares Grayscale Bitcoin Trust. Although it did not explain the details of the sale price, but it is clear, the move was done to be able to pay the creditors of the bankruptcy of Genesis which reached more than three billion US dollars.

Not only that, DCG is also said to be selling a quarter of its shares in Grayscale Ethereum Fund, a small number of shares in Grayscale Litecoin Trust, Bitcoin Cash Trust, Ethereum Classic Trust, and Digital Large Cap Fund.

Facing Investigations from the US Attorney

The turmoil that Barry Silbert and his business empire experienced seemed to continue to spread. In addition to several litigation disputes and financial pressure, DCG is also facing investigation from the Office of the Attorney General of the United States (USA).

According to a source familiar with the matter, US authorities are currently investigating the internal financial transactions of DCG and its subsidiaries. Although it is not clear which entity is being monitored, what is clear is that an investigation is also being conducted in relation to any information announced to investors.

“The prosecutor has requested interviews and supporting documents. The SEC is also investigating, everything is still in its early stages. However, neither Silbert, DCG, nor any of their business entities have been accused of wrongdoing,” US authorities said.

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