Too Long; Didn't Read
Of the fallout that we began to see this week from SBF’s apparently epic fraud, perhaps the most significant casualty is the likely insolvency and potential bankruptcy of crypto lender Genesis, which could be mega enough to also bring down its parent company, prominent venture capital firm Digital Currency Group (DCG). The Genesis/DCG melodrama – which also includes Genesis’s sister firm, digital asset fund Greyscale – is particularly impactful because it directly affects the largest Bitcoin investment product listed on any exchange, GBTC. The reason why GBTC is so important to us crypto traders is that it holds one of the largest stashes of Bitcoin. Should investors – willingly or not – be allowed to redeem GBTC shares for BTC or USD, it could spark the next brutal leg down in the fiat price of Bitcoin and other shitcoins.
In this essay, I’ll be delving into the digital money management business and breaking down the Genesis/DCG/Greyscale soap opera… G G G G-Unit! And as the essay comes to a close, I’ll lay out a rubric for evaluating a potential means of profiting off of this carnage.