Skip to main content

DCG losses top $1B on the back of 3AC collapse in 2022

The crypto conglomerate reported that falling crypto prices and the fallout from Three Arrows Capital’s loan default to Genesis affected its results.

Cryptocurrency venture capital conglomerate Digital Currency Group (DCG) has reported losses of over $1 billion in 2022 due largely to the contagion relating tocollapse of crypto hedge fund, Three Arrows Capital (3AC).

DCG reportedly lost $1.1 billion last year, according to its Q4 2022 investor report,  and said the results “reflect the impact of the Three Arrow Capital default upon Genesis” along with the “negative impact” from falling crypto prices.

Genesis is the lending arm of DCG, the firm filed for Chapter 11 bankruptcy in late January. Genesis is 3AC’s largest creditor as the company loaned the now-bankrupt hedge fund $2.36 billion, 3AC filed for bankruptcy in July 2022.

DCG’s fourth-quarter losses came to $24 million while revenues came in at$143 million.

Full-year 2022 revenues for DCG came in at $719 million. The firm held total assets of $5.3 billion with cash and liquid holdings of $262 million and investments — such as shares in its Grayscale trusts — amounted to $670 million.

The remaining assets were held by divisions of its asset management subsidiary Grayscale and DCG’s Bitcoin (BTC) mining business Foundry Digital.

Its equity valuation came in at $2.2 billion with a price per share of $27.93 which the report said was “generally consistent with the sector’s 75%-85% decline in equity values over the same period.”

It’s a significant decline from just over a year ago, when DCG declared on Nov. 1, 2021, that its valuation was more than $10 billion following the sale of $700 million worth of shares to companies like Alphabet Inc., Google’s parent company.

Related: Genesis Capital’s fall might transform crypto lending — not bury it

However, the company said it “hit a milestone” with the restructuring of Genesis.

The agreement proposed earlier in February would see DCG contribute its equity share in Genesis’ trading entity and bring all Genesis entities under the same holding company and see its trading entity sold off.

DCG would also exchange an existing $1.1 billion promissory note due in 2032 for convertible preferred stock. Its existing 2023 term loans with an aggregate value of $526 million would also be refinanced and made payable to creditors.

A Genesis creditor said the plan “has a recovery rate of approximately $0.80 per dollar deposited, with a path to $1.00” for those owed money by the firm.



from https://ift.tt/cfoqGvt
https://ift.tt/Nw1mYC7
Labels:

Comments

Post a Comment

Any questions, Please.

Popular posts from this blog

How to play and earn in CryptoKitties

CryptoKitties is a blockchain-based game where players can buy, sell and breed digital cats with unique attributes. Reminiscent of Tamagotchi and Pokémon, the wildly popular digital pets and creatures of the 1990s, CryptoKitties is a blockchain-based game where players can collect, trade and breed digital virtual cats. CryptoKitties was the first Ethereum-based game, and its popularity underscored many of the network’s scaling issues. This digital cat-breeding blockchain game caused quite a bit of congestion on the Ethereum blockchain, peaking in 2020. However, the game’s creators were able to address these issues. What is CryptoKitties? Launched in 2017, CryptoKitties was built by Dapper Labs, the company that uses blockchain technology to bring nonfungible tokens (NFTs) and new forms of digital engagement to fans around the world. CryptoKitties is also considered one of the world’s first-ever blockchain games. In the game, each one of the digital collectible cats possesses a
Post a Comment
Read more

Bitcoin dominance falls under 40%

While Bitcoin critics claim this means that BTC is losing its first-mover competitive advantage, others are anticipating the “altcoin season” is just around the corner, or might even be already underway. Bitcoin’s market dominance has continued to fall, bottoming out below 40% this week. That’s very close to the all-time low of 36.7% in Jan 2018 according to data from Tradingview. Bitcoin ( BTC ) market dominance refers to the ratio between BTC’s market cap and the total crypto market cap. It's not the first time dominance has dipped in 2021. Back in May, Cointelegraph reported that BTC had dipped to represent just 40.3% of the combined crypto asset capitalization, according to Coinmarketcap, and it neared the same level again in September.  Bitcoin critic and Europac chairman Peter Schiff tweeted about the event on Dec 29th, saying that it’s indicative that BTC is “losing its first-mover competitive advantage.” With over 16,000 alternative cryptos to choose from Bitcoin
Post a Comment
Read more

Five Bitcoin Price Charts Analyzing The Dramatic Q1 2022 Conclusion

There are only hours remaining until the Q1 2022 close in Bitcoin price action. With the important quarterly candle set to close tonight, let’s look at what technicals might say about the direction of the next quarter. Q1 2022 Comes To A Close For Bitcoin The first quarter of a year, often sets the tone for the year to come. In investments, a poor Q1 performance is indicative of a bad year ahead. Considering the fact that Bitcoin price is now above $45,000 after touching $32,000 this quarter, it is tough to say the performance has been “poor” by anything other than crypto standards. Related Reading | Bitcoin Weekly Momentum Flips Bullish For First Time In 2022 The cryptocurrency has recovered nearly 40% from the low, leaving a long wick behind. Such a long wick suggests that before the quarter came to a close, buyers stepped up in a major way. Buyers were able to step up in a larger capacity in Q1 2022 than bears were able to in the final quarter of last year. The bearish wick to cl
Post a Comment
Read more