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Why Digital Currency Group Is Suing Its Own Subsidiary Over $1.1 Billion Loan

by admin August 18, 2025



In brief

  • Digital Currency Group has sued its subsidiary Genesis, the now-shuttered crypto lender.
  • The crypto giant claims that a $1.1 billion loan it made to Genesis was more than enough to cover its losses following its 2022 collapse—and that the firm has actually profited.
  • The latest lawsuit comes after Genesis in May sued Digital Currency Group for $3.1 billion.

Digital Currency Group has sued its subsidiary Genesis, claiming that the collapsed crypto lender has actually profited in the long-term following its collapse and subsequent bailout. 

In a lawsuit filed Thursday, DCG said that the $1.1 billion loan it gave to Genesis in 2022 was ultimately more than enough to cover its losses.

Crypto lender Genesis went bankrupt in 2023 as it had lent money to collapsed crypto firm Three Arrows Capital and other firms during the bear market and “crypto contagion” that spread across the industry in 2022.



DCG stepped in with capital to help repay Genesis customers. But in Thursday’s lawsuit, DCG argued that due to a rise in the value of recovered collateral from Three Arrows Capital, its obligations under the promissory note have been reduced to zero. 

This, the lawsuit states, is because the assets from Three Arrows Capital were in Bitcoin and Grayscale Bitcoin Trust shares that have shot up in value since 2022. 

“Genesis ultimately suffered no loss from TAC’s default; rather Genesis has profited by hundreds of millions of dollars (which Genesis is entitled to keep),” the lawsuit said. 

It added: “Because of the significant appreciation in cryptocurrency values since the petition date, this has resulted in recoveries that exceed the dollar value of the creditors’ claims as of the petition date.”

Genesis was a crypto lender run by crypto behemoth DCG. It allowed users to earn cash on their crypto holdings by allowing them to be loaned out to others.

Genesis made billions of dollars in loans to beleaguered crypto firms like Three Arrows Capital and the FTX-linked Alameda Research, which were about to default on their debt due to market contagion stemming from the collapse of Terra. 

When mega digital asset brand FTX collapsed, Genesis announced to clients that it would pause withdrawals from its lending arm due to the “unprecedented market turmoil.”

“DCG took extraordinary efforts to voluntarily support Genesis in 2022, including by issuing a promissory note to Genesis to help close a potential book equity gap resulting from the collapse of Three Arrows Capital,” a DCG spokesperson told Decrypt on Friday. “We have consistently met our contractual obligations under that note, but believe those have now been fully satisfied. We are simply asking the Court to confirm that the valid and binding obligation was fully satisfied.”

Thursday’s lawsuit comes after Genesis in May sued DCG, alleging that its parent company and CEO Barry Silbert made fraudulent transfers from the lender as it was collapsing in 2022. It’s seeking $3.1 billion in damages. 

Editor’s note: This story was updated after publication to include a statement from DCG.

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August 18, 2025 0 comments
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NFT Gaming

Japan’s Metaplanet Plans to Inject $5B Into U.S. Subsidiary to Accelerate BTC Strategy

by admin June 24, 2025



Metaplanet’s (3350) board of directors has approved a capital injection of up to $5 billion for its U.S. subsidiary, Metaplanet Treasury Corp, in a bid to speed up its bitcoin

acquisition strategy.

The Japanese hotel company set up its Florida-based subsidiary on May 1, aimed at expanding its global bitcoin treasury operations.

The contribution is expected to significantly accelerate the implementation of its “555 million plan,” disclosed earlier on June 6, the company said in a statement.

Metaplanet’s strategic objective is to accumulate up to 210,000 BTC by the end of 2027, leveraging the deep capital markets and advanced institutional infrastructure in the U.S. to optimize acquisition and management processes.

This U.S. expansion aligns with the company’s broader vision to establish a globally integrated treasury model that supports shareholder value, improves treasury yield efficiency and strengthens its leadership in bitcoin capital markets.

The funding for this contribution will come from exercising the 20th to 22nd series of stock acquisition rights, and all proceeds will be directed toward additional bitcoin purchases. Importantly, there is no change to the previously disclosed intended use of funds.

The financial impact on the company’s current fiscal year results is expected to be minimal, but Metaplanet has committed to promptly disclosing any material developments.

Shares of the Tokyo-listed Metaplanet, the eighth largest corporate holder of bitcoin with 11,111 BTC, closed 7% lower on Tuesday.

Read more: Metaplanet Buys 1,111 Bitcoin for $117M, Pushes Total Holdings to Over 11K BTC



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June 24, 2025 0 comments
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Screen Actors Guild Files Charges Against Epic Games Subsidiary Over AI Darth Vader

by admin May 20, 2025



In brief

  • The U.S. Screen Actors Guild has urged the U.S. National Labor Relations Board to act after Epic replaced Fortnite voice actors with AI without bargaining.
  • The charge come days after an AI Darth Vader was at the center of controversy over racial slurs and profanity in Fortnite.
  • The complaint highlights the guild’s ongoing battle over AI in the entertainment industry.

The Screen Actors Guild–American Federation of Television and Radio Artists, or SAG-AFTRA, filed a labor complaint against Llama Productions, a subsidiary of Epic Games, on Monday.

The complaint accuses the company of replacing voice actors with artificial intelligence without union consent.

The move follows public backlash last week over an AI-generated Darth Vader character in the popular video game Fortnite that used racial slurs and offensive language.

SAG-AFTRA alleges Llama Productions used AI to create the Darth Vader character in Fortnite’s crossover event, “Galactic Battles.” They did so without notifying or negotiating with the union, violating labor agreements, the complaint alleges.

“We became aware when the press release hit the wires,” a SAG-AFTRA spokesperson told Decrypt.

A labor relations board charge, also known as an unfair labor practice charge, is a complaint that claims an employer or union has violated labor relations law. SAG-AFTRA maintains that its involvement is essential in any decision to replace human work with AI.

“This charge concerns the union’s critical role in negotiating terms concerning the replacement of bargaining unit work with AI technology,” the spokesperson said. “We are very supportive of AI tools to enhance the audience experience, but employers cannot implement these types of uses without coming to the union first and bargaining terms.”

According to the SAG-AFTRA spokesperson, the union did not approach Epic Games before filing the charges, and the Fortnite developer has not yet responded. Epic Games did not immediately respond to Decrypt’s request for comment.

The union is asking the NLRB to issue a formal complaint, citing Llama Productions’ alleged failure to bargain in good faith.

“Within the past six months, the Employer, by its agents and representatives, failed and refused to bargain in good faith with the union by making unilateral changes to terms and conditions of employment, without providing notice to the union or the opportunity to bargain, by utilizing AI-generated voices to replace bargaining unit work on the interactive program Fortnite,” the attorneys for SAG-AFTRA wrote.

If a violation is found, Llama Productions could be required to reinstate affected employees and provide back pay. The board may also order the company to post notices informing workers of their rights and the case outcome. The agency does not impose fines or punitive penalties.

The complaint comes amid broader action by SAG-AFTRA voice actors, who have been on strike since July 2024. AI use in game development is emerging as a key point of contention.

It is unclear how the SAG-AFTRA complaint will affect productions that use the licensed voices of actors who have already passed away.

Before he died in 2024, iconic actor James Earl Jones, who voiced Darth Vader, licensed his voice to Lucasfilm. The agreement allows the creator of Star Wars to use Jones’ voice in future projects.

Other actors whose estates have licensed their voices to AI developers include Judy Garland, Jimmy Stewart, James Dean, and Grateful Dead frontman Jerry Garcia.

While the guild said it celebrates the rights of its members and their estates to control the use of their “digital replicas,” it added that rights to bargaining terms must be “protected,” including those who previously worked on “matching Darth Vader’s iconic rhythm and tone in video games.”

Edited by Sebastian Sinclair

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May 20, 2025 0 comments
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