coinspress.com
Digital Currency Group (DCG), a venture capital conglomerate, is set to close its subsidiary TradeBlock due to various factors, including the state of the broader economy and regulatory uncertainties surrounding cryptocurrencies in the United States.
TradeBlock, led by Breanne Madigan, will initiate the shutdown process on May 31, as stated in a report by Bloomberg on May 25.
A spokesperson, cited by Bloomberg, explained that the decision to wind down the institutional trading platform aspect of the business was influenced by the challenging regulatory environment for digital assets in the US, combined with the prolonged crypto winter and overall economic conditions.
This closure comes after DCG previously shut down its wealth-management division headquarters in January 2023. The prolonged crypto winter and the collapse of FTX, along with the subsequent crypto downturn, had a cascading effect on DCG companies, leading to the layoff of over 500 employees.
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DCG itself faced substantial losses of over $1 billion in 2022, largely attributed to the repercussions of the downfall of the cryptocurrency hedge fund Three Arrows Capital.
Adding to their recent troubles, DCG failed to make a $630 million debt payment owed to Gemini, a troubled cryptocurrency exchange. Gemini is now considering a forbearance option, which would temporarily reduce or halt payments, depending on DCG’s willingness to engage in negotiations for a consensual agreement.