• Digital Currency Group (DCG) is selling its crypto holdings at distressed prices following the bankruptcy of Genesis.
• DCG owns Grayscale Bitcoin Trust, which has been trading at a sizable discount due to concerns over the reserves held.
• Market seems to have priced this in, but there could be more twists to come.
Barry Silbert’s DCG Selling Off Assets at Distressed Prices
Digital Currency Group (DCG), owned by Barry Silbert, has begun selling off its crypto assets at distressed prices following the bankruptcy of Genesis. This news caused concern in the market as DCG also owns Grayscale Bitcoin Trust, which has been trading at a sizable discount due to worries about whether it holds enough reserves.
Grayscale Bitcoin Trust Trading At Discount
The Grayscale Bitcoin Trust trades at a sizeable discount compared to its net asset value due to several factors such as difficulty in redeeming shares and fees payable. Furthermore, there have been calls for proof of reserves from Grayscale but they declined to provide assurance adding to concerns around the trust’s reserve holdings.
DCG Selling Crypto Holdings At Distressed Prices
Given the difficulties faced by DCG, they have now begun selling off their crypto assets at distressed prices leading some investors to question whether this will cause further disruption in the crypto market.
Market Seems To Have Priced In Risk Of Contagion
Despite these fears being raised, it appears that the market has already priced in any potential contagion risk associated with the sales and does not seem overly concerned about further disruption or volatility occurring as a result.
More Twists Likely To Come
However, given how unpredictable and volatile cryptocurrencies can be, it is likely that there are still more twists and turns ahead for DCG and Grayscale as this situation continues to unfold over time.