Gemini, a cryptocurrency exchange, has reached a settlement with the New York Department of Financial Services (NYDFS) to return at least $1.1bn to customers of its defunct lending programme. As part of the agreement, Gemini will also pay a $37m fine for “significant failures”. The exchange’s Earn programme was discontinued during a crypto crash in November 2022.
Co-founded by twins Tyler and Cameron Winklevoss, Gemini failed to conduct due diligence on an unregulated third party, leading to a financial meltdown that affected Earn customers. NYDFS Superintendent Adrienne Harris stated that the settlement is a victory for Earn customers who deserve the return of their assets.
Gemini has worked diligently to advocate for Earn users and secure the return of their assets, with plans to return over $1.8 billion in value. The company will also contribute $40m towards the conclusion of Genesis’ bankruptcy to benefit Earn customers.
The Earn programme, offered in partnership with Genesis Global Capital, faced extensive litigation following its halt in November 2022. Customers have been unable to access their funds since then, but the settlement brings them closer to recovering their money.
Gemini, run by the Winklevoss twins, has also faced legal challenges from US regulators for allegedly illegally selling crypto assets through Earn. The case is being overseen by the US Securities and Exchange Commission.
Related Topics:
– New York City
– Cryptocurrency
