‘Joining Forces’: Genesis and Gemini Discussed Merger Before Collapse

Crypto mogul Cameron Winklevoss was reportedly “intrigued” by the idea of merging his crypto exchange Gemini with digital asset lender Genesis before it failed, court documents show. 

Digital Currency Group (DCG) boss Barry Silbert claimed that the Winklevoss twin was “intrigued about the idea of a closer partnership between Genesis/Gemini/DCG, including a potential merger of the companies,” according to an October 2022 email filed with the Supreme Court of the State of New York yesterday, 

At the time, DCG-owned company Genesis had a partnership with NY-based Gemini where it supplied it with cash for a program called Earn. The Earn program allowed customers to earn some cash on their crypto. 

But then Genesis froze customer withdrawals in November 2022. It then filed for bankruptcy in January 2023. Gemini has been clashing with DCG ever since, battling to get former customers’ money back. 

“I put him on clear notice that the path we’re on right now could lead to a Genesis bankruptcy, which would put Gemini’s deposits (and therefore, Gemini’s business) at significant risk,” Silbert’s email continues. 

“He took that part surprisingly well and appreciates we need to work together to mitigate that risk. Next steps: he is going to chat with Tyler and come back with thoughts on how best to proceed.”

Silbert adds that “joining forces” was the “most exciting” option because it could potentially allow them to “be a juggernaut” that could compete with exchanges Coinbase and FTX. 

FTX unexpectedly went bankrupt in November 2022. Genesis froze withdrawals because of the “unprecedented market turmoil” that followed the exchange's collapse. 

Gemini and Genesis never merged, and following the lender’s bankruptcy, Gemini has since sued Genesis.

Last year, the New York’s Attorney General filed a lawsuit against Gemini, Genesis, DCG, Silbert, and former Genesis CEO Michael Moro for allegedly defrauding investors. In February, the NYAG updated the lawsuit—and now is trying to get $3 billion in restitution for those investors.

Edited by Ryan Ozawa.

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