The recent FTX collapse has demonstrated the shortfalls of third parties. Successful businesses in the future will incorporate multisig into their operations.
The below is a direct excerpt of Marty’s Bent Issue #1283: “Trusted third parties are security holes.” Sign up for the newsletter here.
The contagion event that has dragged on for the better part of 2022 seems to be materially affecting Genesis Trading and its parent company, Digital Currency Group (DCG). It has become apparent that Genesis didn’t have the best due-diligence process when issuing loans to counterparties because they had to write down two nine-figure loans to zero this year after lending out money to Three Arrows Capital and Alameda Research.
The hole these bad loans left in Genesis’ balance sheet forced the company to halt withdrawals and the legitimacy of the Grayscale Bitcoin Investment Trust (GBTC) — a Genesis sub-company — is beginning to be called into question. To make matters worse, it seems
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