The Block reported that a U.S. federal court has decided to rehear fraud allegations in a class-action lawsuit related to Genesis Yield, filed against Grayscale founder Barry Silbert and Digital Currency Group (DCG). Judge Stefan Underhill of the U.S. District Court for the District of Connecticut partially modified a decision made in February, accepting the plaintiffs' argument last week that state law claims are also subject to the court's review under the Class Action Fairness Act. Consequently, the common law fraud claim under New York state law will proceed to trial again, while most consumer protection law claims from other states have been dismissed or their hearings suspended. This lawsuit was filed concerning Genesis Yield, a lending product where users deposit cryptocurrency and earn interest. Investors allege that Barry Silbert and DCG deliberately misled investors about Genesis's financial health and risk management prior to the suspension of withdrawals and its bankruptcy filing in early 2023.
