DCG Shareholder Letter: We are doing well, annual revenue expected to reach $800 million

The Wall Street Journal claims to have a shareholder letter from DCG but has not released it yet. The following is a summary based on some of their reports and the full text released by the crypto community Platonic NEET.

Trading and Custodial Services Operating Normally

Barry Silbert stated that the suspension of lending activities by Genesis, which caused a stir, has not affected spot, derivatives trading, and custodial services.

The senior management and board are currently hiring financial and legal advisors to explore all potential options.

$925 Million Loan Due Next Year

DCG currently has a debt of $575 million to its subsidiary Genesis, which is due in May 2023. Barry pointed out that this type of lending relationship is similar to hundreds of other cryptocurrency institutions, priced based on fair market principles and market rates, and not an abuse of funds.

In addition, DCG's debt also includes $350 million from Eldridge Holdings and $350 million from small lenders.

Need to Absorb 3AC Bad Debt

When Three Arrows Capital went bankrupt, there were reports of business dealings with Genesis, which later admitted to losing hundreds of millions of dollars.

Barry stated that DCG had intervened and taken on the bad debts caused by the default between Genesis and Three Arrows Capital. DCG is also participating in the creditors' committee and liquidation process with 3AC, seeking possible remedies.

He emphasized that DCG's overall annual revenue is expected to reach $800 million. If a decision is made to proceed with a new round of financing, it will be announced separately.

Previous reports indicated that Genesis' financing is ongoing, reduced from an initial $1 billion to $500 million.