Popular Youtuber and digital currency influencer Chico Crypto recently released a video explaining his thoughts on the Digital Currency Group’s (DCG) links to the so-called ‘deep state’ and Bitcoin’s hostile takeover.
An overview of Digital Currency Group and the corporate takeover of Bitcoin
Chico Crypto begins with a summary of the current situation; FTX has imploded, there are rumors that Binance is on the brink, and Barry Silbert’s DCG is reportedly in financial trouble. He points out that if DCG goes down, it will be a crash on another level, and regulators would immediately target the digital currency markets.
Who is Digital Currency Group? It’s a huge company that owns stakes in many of the key companies in the digital currency industry. Grayscale Bitcoin Trust (GBTC) is one of them. Chico notes that the price per share of the Trust is down 85%, and there’s a huge discount on the price-per-share (50%), the largest in history, and a clear indicator that things aren’t right.
DCG also owns Genesis Global Capital. Its lending platform recently halted withdrawals with over $2.8 billion of total active loans as of the end of Q3 2022. This serves primarily institutional clients, so if it goes down, there will be trouble ahead. The fact that it recently reached out for a $1 billion loan suggests that trouble may become a reality sooner rather than later.
“DCG is having major problems,” Chico emphasizes, going on to list some of its other interests in the industry. These include stakes in Blockstream, Chainalysis, Circle, Coinbase (NASDAQ: COIN), Etherscan, Kraken, Paxos, Ledger, Ripple, Silvergate Bank, and many others. A DCG collapse would almost certainly take the industry as we know it down for good.
Is this a deliberate attack on the digital currency industry?
Chico is known to look at things from every angle, including potentially conspiratorial ones. He recently covered how FTX founder Sam Bankman-Fried and his family had ties to Senator Elizabeth Warren, Securities and Exchange Commission Chairman Gary Gensler, and the wider Democratic Party.
“It gets even worse with DCG,” Chico says, pointing out how Lawrence Summers and Glenn Hutchins were listed either as board members or advisors before DCG scrubbed this page on its website.
Hutchins is a large donor to the Democratic Party, particularly Hillary Clinton, held various roles in Bill Clinton’s campaign, and used to be on the Board of Directors of the Federal Reserve Bank of New York.
Summers is a former Treasury Secretary under Bill Clinton and served as Director of the White House National Economic Council under Barack Obama. He also served as Chief Economist at the World Bank.
Chico plays a short clip outlining Mrs. Clinton’s views on digital currencies, which aren’t positive, and then draws the connection between these two and a potential attack on the industry.
The scaling wars and attacks on the Bitcoin protocol
Yet the players involved aren’t the only concern.
“DCG itself has proven time and time again that it doesn’t have the market’s best interests at heart,” Chico says.
He points to the scaling wars which saw Bitcoin fork into BTC and BCH. He notes that DCG was a vocal proponent of SegWit, which fundamentally changed the Bitcoin protocol. He outright points the finger at DCG for starting these wars, pointing to a 2017 blog post in which they agree to support SegWit and indicate they will support raising the block size to 2MB within six months.
Chico also points out that DCG was an early investor in Blockstream and has influence over the company’s decisions. “Blockstream has been trying to take over BTC development for a long time,” he says, highlighting a Reddit thread that details Blockstreams’ aggressive takeover attempts through the years.
“DCG has proven that they want to take over Bitcoin, and if they can’t, they’ll attempt to destroy it,” he says. He notes that FTX hurt retail speculators badly, and if DCG goes down and harms institutional investors, this would be akin to a 1-2 punch that will give regulators the ammunition they need to move aggressively against the industry.
A well-researched video that misses a key point
Chico Crypto did some solid research for this video, and that’s praiseworthy. However, he’s clearly a fan of ‘crypto’ and hasn’t put the final pieces of the puzzle together yet—BTC itself is an attack on Bitcoin, and the entire digital currency industry needs to die before anything good can happen. Regulators stepping in and steamrolling the criminal actors that have held sway in the industry for too long is a good thing and is not something to be resisted.
Bitcoin, as Satoshi Nakamoto designed it, exists today as BSV. It is the original protocol restored, representing the truth: we only ever needed one blockchain, and all of the others are either unnecessary or outright scams.
Chico is almost there. He’s just a few steps away from realizing what we have been saying at CoinGeek for years; ‘crypto’ is going away, few blockchains will be left standing, and the original Bitcoin, Satoshi’s peer-to-peer electronic cash system, which is all we ever needed, will be the one that flourishes. Clearly, people are starting to wake up and put the pieces together. This will only accelerate in the months and years to come.
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Ethereum, FTX and Tether—who have co-opted the digital asset revolution and turned the industry into a minefield for naïve (and even experienced) players in the market.
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