DCG Sues Genesis Over $1.1B Note Amid Post-Crash Fallout

- Digital Currency Group (DCG) initiates legal action against Genesis over a disputed $1.1 billion promissory note. - The lawsuit follows financial turmoil in the aftermath of the Three Arrows Capital (3AC) collapse. On August 15, 2025, *The Block* reported that Digital Currency Group (DCG) filed a lawsuit against its subsidiary, Genesis Global Capital, in the U.S. Bankruptcy Court for the Southern District of New York. The case centers on a $1.1 billion promissory note, which DCG issued to stabilize Genesis after a major borrower, the crypto hedge fund Three Arrows Capital (3AC), defaulted during the 2022 market crash. DCG argues that collateral linked to Three Arrows Capital has recovered and appreciated significantly since the collapse, claiming its value now exceeds that of the promissory note. As a result, DCG seeks a court ruling to compel Genesis to repay $105 million, including accrued interest. This lawsuit underscores the escalating tensions between DCG and Genesis amid their ongoing financial struggles. Genesis entered bankruptcy in 2023 and has since engaged in extensive restructuring and litigation. In a separate action, the Genesis Litigation Oversight Committee filed claims earlier this year seeking $2.1 billion to distribute to creditors, while Genesis has started disbursing around $4 billion in assets to its creditors. As an equity stakeholder, DCG is positioned for delayed repayment under the bankruptcy plan. According to CoinMarketCap, as of 12:00 UTC on August 15, Bitcoin (BTC) was priced at $29,450, and its 24-hour trading volume had dropped by 1.7%.