Winklevoss Crypto Firm Gemini will return $1.1bn to their Customers
Gemini, the renowned Cryptocurrency exchange has agreed to return at least $1.1bn (£870m) to their customers. The defunct leading program has led to this situation and as a part of this settlement with the New York Department of Financial Services (NYDFS). Gemini will also have to pay a $37M fine for these “significant failures that threatened the safety and soundness of the company” made by the firm. The company’s earning program was halted during a crypto crash in November 2022. This exchange has been co-founded by the twins Tyler and Cameron Winklevoss. They are also known for their legal dispute with Facebook.
On Wednesday Gemini posted on X formerly known as Twitter, noting the settlement has been reached “in principle” with Genesis. The other creditors in the related bankruptcy that return in “all Earn users receiving 100% of their digital assets back in kind…If approved, we will be returning over $1.8 billion in value (at today’s prices) — $700 million more than when Genesis halted withdrawals on November 16, 2022.”
Adrienne Harris, the NYDFS Superintendent, said in a statement, “Gemini failed to conduct due diligence on an unregulated third party, later accused of massive fraud, harming Earn customers who were suddenly unable to access their assets after Genesis Global Capital experienced a financial meltdown,” she also added, “Today’s settlement is a win for Earn customers, who have a right to the assets they entrusted to Gemini.”
The NYDFS has also shared the fact that if the situation continues like this, the company would have more actions taken on the company. But, the first and foremost thing that has to be done by the company is returning the $1.1bn to customers, at once.
To this situation, Gemini has shared a blog post, in the post, they have stated, “worked tirelessly over the past 15 months to advocate for Earn users and seek the return of their assets”. The blog post also mentioned, “If approved, we will be returning over $1.8 billion in value (at today’s prices) — $700 million more than when Genesis halted withdrawals on November 16, 2022.”
In the post, the company also mentioned that they will contribute $40m to the conclusion of Genesis’ bankruptcy. This will benefit Earn customers after this situation. The Earn program was offered in Partnership with cryptocurrency lender Genesis Global Capital.
In November 2022, the program was halted, which was followed by Genesis filing for bankruptcy. Since this time, there has been extensive litigation between Genesis, Gemini, and Genesis’ parent company, Digital Currency Group. Gemini Earn customers have been unable to access the funds in their accounts since the latter months of 2022. The settlement will allow to them get their money back from this firm.
Gemini founders the Winklevoss twins, Tyler and Cameron, have been entwined in a legal dispute with the Meta boss Mark Zuckerberg for a long time. In 2023, The US Securities and Exchange Commission was in charge of the case and accused Gemini and Genesis of illegally selling crypto assets to thousands of customers.
I am Jessica Gonzalez and i have over 16 years experience in the financial services industry giving me a vast understanding of how news affects the financial markets. She is an active day trader spending the majority of my time analyzing earnings reports and watching commodities and derivatives. I have a Masters Degree in Economics from Westminster University with previous roles counting Investment Banking.
