As per reports, Digital Currency Group (DCG) may sell the Coindesk platform to survive in this critical financial situation.
The Digital Currency Group (DCG) is a parent company behind Crypto lender Genesis Global Trading, Crypto backed fund provider Grayscale, and popular Crypto media outlet Coindesk. Coindesk was acquired by DCG in 2016 for $500,000 but the current valuation of this company will be in the millions because the Crypto industry has been shifted from a very small financial market to a very big level & also the reach of Coindesk has expanded over the years.
On 18 Jan 2023, CNBC reported that Coindesk CEO Kevin Worth sent an emailed letter & confirmed that DCG may sell its Coindesk business fully or partially.
CEO’s email stated noted:
“Over the last few months ago, we have received numerous inbound indications of interest in CoinDesk.”
Reason behind Coindesk Selling plan
The whole matter is exhibited in the FTX Crypto exchange bankruptcy, which was filed on 11 Nov 2022 with 100s of FTX affiliated companies.
Initially, Coindesk reported that Alameda Research, a sister Crypto company of the FTX exchange, was holding the majority of the funds in FTX token (FTT), a native token of the FTX exchange. This news acted as a catalyst to create fear among the FTX customers & Investors.
When the leading Crypto exchange Binance announced that it will liquidate its $500 million worth of FTT holdings then FTT token plunged badly and finally in early of Nov 2022 FTX was not able to give withdrawal of funds to its customers. On 11 Nov 2022, FTX filed for Bankruptcy in a US bankruptcy court.
DCG-affiliated Genesis Global Trading had significant exposure to the FTX exchange and bankruptcy of the FTX exchange resulted in a very big loss for Genesis company. To this date, Genesis also owed $900 million worth of crypto assets of the Gemini Crypto exchange via a Crypto interest & yield program.
At the present time, DCG has only an option to sell a significant portion of its stakes to survive the DCG platform. But a recent report noted that Genesis may file for bankruptcy by the end of this week.
A similar kind of unconfirmed information disclosed that DCG may file for bankruptcy for itself and also the leadership will be changed after filing.