U.S. authorities are reportedly investigating internal transfers from Digital Currency Group to its subsidiary Genesis.
Crypto group Digital Currency Group (DCG) is under investigation by the U.S. Department of Justice’s Eastern District of New York and the U.S. Securities and Exchange Commission (SEC), Bloomberg reported.
Citing people familiar with the matter, the report said authorities were investigating internal transfers between DCG and its subsidiary crypto lending firm Genesis Global Capital. Prosecutors have requested interviews and documents from the two companies, while the SEC is conducting a similar early investigation.
So far, no charges have been filed against DCG, and no U.S. agency has provided any information on the case. A spokesperson for DCG said the company was not aware of an investigation:“DCG has a strong culture of integrity and has always conducted its business lawfully. We have no knowledge of or reason to believe that there is any Eastern District of New York investigation into DCG.”
Genesis was one of the companies affected by the wave of contagion following the FTX crash in November. According to the company’s Nov. 10 disclosure, it has $175 million locked in FTX trading accounts. Genesis halted withdrawals on Nov. 16 due to liquidity issues and has partnered with investment bank Moelis & Company to assist with the restructuring.
