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Venture capital conglomerate Digital Currency Group (DCG) is closing its brokerage subsidiary TradeBlock, citing the state of the economy as a whole and the uncertain regulatory environment for cryptocurrencies in the United States.
According to a May 25 Bloomberg report, TradeBlock, led by Brynn Madigan, will officially begin the process of shutting down from May 31.
Barry Silbert’s cryptocurrency conglomerate, Digital Currency Group, is shuttering its TradeBlock institutional trading platform https://t.co/duE4YnknrR
— Bloomberg cryptocurrency (@crypto) May 25, 2023
“Due to the state of the economy in general and the prolonged cryptocurrency winter, as well as the difficult regulatory environment for digital assets in the United States, we have made the decision to close the institutional trading platform part of the business,” a spokesman for Bloomberg said.
DCG and its portfolio of companies have run into trouble due to the long cryptocurrency winter. The closure of TradeBlock comes after DCG previously closed the headquarters of its asset management division in January 2023.
Related: Gemini and Genesis legal troubles could shake up the industry even more
In a previous report, it was reported that DCG companies laid off over 500 employees as a result of the FTX crash and the cryptocurrency slump.
Venture capital conglomerate DCG also posted losses in excess of $1 billion in 2022. The losses were mainly due to the ripple effect caused by the collapse of the cryptocurrency hedge fund Three Arrows Capital.
In later events, DCG missed paying Gemini’s $630 million debt. Troubled cryptocurrency exchange Gemini is said to be considering a hold on DCG, which recently failed to pay $630 million.
The forbearance will allow the borrower, DCG, to temporarily reduce or suspend payments with the expectation of resuming them later. Gemini said its consideration of the leniency issue will depend in part on DCG’s willingness to negotiate in good faith for a consensus agreement.