Coindesk May Be Sold as Parent Company DCG Struggles
According to recent reports, the cryptocurrency news website CoinDesk is mulling over the possibility of being sold as its parent company, Digital Currency Group (DCG), wants to improve its financial standing.
The Wall Street Journal reports that CoinDesk has enlisted the assistance of investment bankers from the financial advising firm Lazard. These investment bankers are assisting the company in weighing its alternatives, which may include a whole or partial sale.
You know, I recently became aware that Coindesk is now available for purchase.
Charles Hoskinson, who tweets under the handle @IOHK Charles 19th of January, 2023 In the past few months, it has been reported that DCG has received multiple offers for the media company that are higher than $200 million. If these reports are accurate, this would represent an incredible return on investment for DCG given that the company was reportedly purchased by DCG for only $500,000 in 2016.
It would seem that Barry Silbert's DCG is experiencing significant financial difficulties as of late. On January 17, the company informed its shareholders that it will be suspending dividend payments in an attempt to improve the soundness of its balance sheet and "preserve liquidity."
On January 18, Bloomberg reported that another DCG subsidiary, crypto lending business Genesis Global, was intending to file for bankruptcy after it revealed that it owed creditors over $3 billion. This is undoubtedly the primary cause contributing to DCG's current financial predicament.
According to the company's website, DCG's venture capital portfolio includes about 200 crypto-related startups, some of which include CoinDesk and Genesis.
The asset management company Grayscale Investments, the cryptocurrency exchange Luno, and the advising firm Foundry are all other businesses that are owned by DCG.
Some people believe that the article published by CoinDesk in November that revealed the irregularities in Alameda Research's balance sheet was the first domino that eventually led to the collapse of the cryptocurrency exchange FTX as well as the liquidity issues that Genesis, its parent company DCG, and the broader cryptocurrency market are currently facing.