New York Attorney General Letitia James has reportedly launched an investigation into Digital Currency Group (DCG), the parent company of Genesis, a cryptocurrency firm that has been facing financial troubles.
Alleged Investigation Into Digital Currency Group Business Practices And Compliance
According to reports circulating on social media platform X, formerly known as Twitter, the investigation is said to be focused on DCG’s business practices and compliance with state regulations. The New York Attorney General’s office has not yet confirmed the investigation, and DCG has not stated the matter.
Genesis, which is a subsidiary of Digital Currency Group, has faced several challenges in recent months. In June, the firm announced that it would be winding down its lending business, citing regulatory concerns. The move came after the U.S. Securities and Exchange Commission (SEC) reportedly sent a letter to the firm questioning its lending practices.
The SEC has been increasingly scrutinizing the cryptocurrency industry and has recently taken action against several firms that it believes have violated securities laws.
Digital Currency Group, which is one of the largest investors in the cryptocurrency space, has also been facing its challenges. In May, the firm announced that it had raised $700 million in a new funding round, but also revealed that it had made several significant losses in its cryptocurrency investments.
If the reports of an investigation by the New York Attorney General’s office are true, it could be a significant blow to DCG and the wider cryptocurrency industry. The investigation could lead to increased regulatory scrutiny of the industry, which could hurt its growth and adoption.
It remains to be seen what the outcome of the investigation will be, and whether DCG will face any penalties or fines as a result. However, it is clear that the cryptocurrency industry is facing increasing regulatory pressure, and that firms operating in this space need to be mindful of compliance with state and federal regulations.
Featured image from Unsplash, chart from TradingView.com