May 26, 2023 08:45
Digital Currency Group (DCG) will shutter its trade execution and prime brokerage subsidiary, TradeBlock, citing the concerns of the broader economy and regulatory uncertainties in the United States. It will initiate the close-down process on 31 May, as reported by Bloomberg.
TradeBlock Could Not Survive the Harsh Market Conditions
“Due to the state of the broader economy and prolonged crypto winter, along with the challenging regulatory environment for digital assets in the US, we made the decision to sunset the institutional trading platform side of the business,” a DCG spokesperson said in a media statement.
TradeBlock was established in 2011 by Jaron Lukasiewicz and Paul Simos, that received popularity for its crypto price indexes, trading platforms, and analytics tools. The company was acquired by Coindesk, the crypto-focused media outlet of DCG, in 2021. However, Coindesk only kept the index data business, rebranding it to CoinDesk Indices, and spun off the other units as a standalone trading business.
Many Challenges for DCG
The shuttering came when the Digital Currency Group has been facing challenges over the bearish market stance and from its exposure to other collapsed crypto companies. The group also shuttered its wealth wealth-management division headquarters in January.
Barry Silbert-led DCG’s crypto lending arm also filed for bankruptcy in New York earlier this year. Genesis Global Holdco and its two lending subsidiaries, Genesis Global Capital and Genesis Asia Pacific, were named in the Chapter 11 proceedings.
The DCG’s troubles can also be measured by its losses exceeding $1 billion in 2022, as disclosed by the group, mostly due to its exposure to the cryptocurrency hedge fund Three Arrows Capital.
DCG also locked into a spat with Winklevoss-twins’ crypto exchange Gemini. During the bankruptcy, Genesis agreed to an exit plan to repay a $765.9 million loan to Gemini. However, the bankrupt company missed its $630 million repayment earlier this month, pushing Gemini to consider a forbearance option against DCG.
This article was written by Arnab Shome at www.financemagnates.com.
World Crypto Global
