Venture capital conglomerate Digital Currency Group (DCG) is closing its prime brokerage subsidiary TradeBlock, citing the state of the broader economy and an uncertain regulatory environment for crypto in the United States.
According to a May 25 report from Bloomberg, TradeBlock, led by Breanne Madigan, will officially begin the process of shutting down effective May 31.
Barry Silbert’s crypto conglomerate, Digital Currency Group, is shuttering its TradeBlock institutional trading platform https://t.co/duE4YnknrR
— Bloomberg Crypto (@crypto) May 25, 2023
“Due to the state of the broader economy and prolonged crypto winter, along with the challenging regulatory environment for digital assets in the US, we made the decision to sunset the institutional trading platform side of the business,” a spokesperson reportedly told Bloomberg.
DCG and its portfolio of companies have faced challenges over the prolonged crypto winter. The closure of TradeBlock comes after DCG previously shut down its wealth-management division headquarters in January 2023.
Related: Gemini and Genesis’ legal troubles stand to shake up industry further
In previous coverage, Cointelegraph reported that DCG companies had laid off over 500 employees as a result of contagion from the collapse of FTX and the crypto downturn.
The venture capital conglomerate DCG also disclosed losses exceeding $1 billion in 2022. The losses were primarily attributed to the ripple effect caused by the downfall of the cryptocurrency hedge fund Three Arrows Capital.
In more recent developments, DCG missed a $630 million debt payment owed to Gemini. The troubled cryptocurrency exchange, Gemini, is said to be contemplating a forbearance option in relation to DCG, which recently failed to make a $630 million repayment.
Forbearance would allow the borrower, DCG, to temporarily reduce or halt payments, with the expectation of resuming them later. Gemini stated that its consideration of forbearance would depend partly on DCG’s willingness to engage in good-faith negotiations for a consensual agreement.
Magazine: Should crypto projects ever negotiate with hackers? Probably