A court ruling classifying Genesis Yield as a security lets investors pursue claims that DCG hid a $1.1 billion insolvency tied to Three Arrows Capital
A federal judge has revived part of an investor lawsuit against Barry Silbert, Digital Currency Group (DCG) and other defendants over the failed Genesis Yield crypto lending program.
The ruling restored a New York common law fraud claim after plaintiffs successfully argued that the court had jurisdiction under the Class Action Fairness Act. The judge also kept the lawsuit’s federal securities claims alive, finding the allegations sufficient to proceed.
Investors claim the defendants misrepresented Genesis’ financial health before it froze customer withdrawals and entered bankruptcy in 2023, while most remaining state consumer protection claims were either dismissed or stayed.
