Cryptocurrency-focused conglomerate Digital Currency Group (DCG) is shutting down its wealth management unit called HQ, CoinDesk, a DCG-owned media outlet, reported on Friday.
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Fast facts
- DCG said it decided to wind down HQ due to the “state of the broader economic environment and prolonged crypto winter presenting significant headwinds to the industry,” according to the media report citing a statement from the company.
- The Information reported on Thursday that HQ had over US$3.5 billion in assets under management.
- DCG’s wholly-owned brokerage subsidiary, Genesis Global Trading, also announced a 30% staff reduction to keep afloat with 145 employees, adding on to a 20% layoff in August last year, according to a separate CoinDesk report on Friday.
- Genesis and its parent firm, which also owns crypto asset manager Grayscale and mining firm Foundry, have been under the spotlight for their debt issues stemming from the Three Arrows Capital contagion of 2022.
- DCG said in a November letter to shareholders that it owed a US$575 million loan and a US$1.1 billion promissory note to Genesis Global Capital, the lending arm of Genesis Global Trading.
- Genesis Global Capital suspended redemptions and new loan originations in November.
- DCG did not immediately respond to Forkast’s requests for comment.
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