Crypto lender Genesis has filed two separate lawsuits against its parent company, Digital Currency Group (DCG), and its CEO, Barry Silbert. The lawsuits allege fraud, reckless mismanagement, and financial exploitation from DCG that contributed to the bankruptcy of the now-failed crypto lender. 1.2 billion dollars was allegedly withdrawn by DCG before Genesis filed for bankruptcy. A key accusation is that Genesis’s funds were siphoned off through self-serving loans and concealed transfers, while a false image of financial health was presented to lenders. These actions led to over $2.1 billion in crypto assets being transferred away from Genesis as the company teetered towards collapse. 2.2 billion dollars in crypto assets are still owed to creditors, including Bitcoin, Ether, and numerous other digital coins, along with significant unpaid fees and interest. The lawsuits claim that Silbert and other DCG insiders ignored key risk controls and pushed for reckless lending practices that ultimately benefited DCG’s investment arm Grayscale Investments. The complaint details a complex scheme involving the use of Genesis as an ATM for DCG, manipulating financial statements to mislead lenders into believing in a stable financial position. 100% of funds were reportedly recovered by insiders during Genesis’s collapse while creditors were left exposed. Genesis is seeking more than $3.3 billion in compensation through these lawsuits. A New York judge has agreed that the New York Attorney General’s civil fraud lawsuit against DCG and Silbert can proceed. The suit alleges that DCG misrepresented its financial status following the collapse of Three Arrows Capital, hiding a $1 billion shortfall with a promissory note. While Gemini and Genesis settled, DCG and their executives are fighting the charges, arguing they didn’t sell securities.