Gemini Settles with New York Attorney General, Agrees to Pay $50 Million

Gemini Genesis New York
Last updated:
Author
Ruholamin Haqshanas
Author Categories
About Author

Ruholamin Haqshanas is a contributing crypto writer for CryptoNews. He is a crypto and finance journalist with over four years of experience. Ruholamin has been featured in several high-profile crypto...

Last updated:
Why Trust Cryptonews
Cryptonews has covered the cryptocurrency industry topics since 2017, aiming to provide informative insights to our readers. Our journalists and analysts have extensive experience in market analysis and blockchain technologies. We strive to maintain high editorial standards, focusing on factual accuracy and balanced reporting across all areas - from cryptocurrencies and blockchain projects to industry events, products, and technological developments. Our ongoing presence in the industry reflects our commitment to delivering relevant information in the evolving world of digital assets. Read more about Cryptonews

Crypto exchange Gemini has reached a settlement with the New York Attorney General (NYAG) and agreed to pay $50 million worth of digital assets to investors of its Gemini Earn program.

The settlement follows allegations made by NYAG Letitia James that Gemini “misled thousands of investors,” including residents of New York, regarding the risks associated with the program, according to an official announcement.

Gemini Earn allowed customers to lend their cryptocurrencies to Genesis Global Capital, LLC, with the promise of earning up to 7.4 percent annual percentage yield (APY).

However, according to the NYAG, Gemini falsely marketed the program and locked investors out of their accounts.

“Gemini marketed its Earn program as a way for investors to grow their money, but actually lied and locked investors out of their accounts,” Letitia James said.

“Today’s settlement will make defrauded investors whole and should remind cryptocurrency companies that deceiving investors is illegal and will not be tolerated by my office.”

All Gemini Investors to Receive Full Recovery

As part of the settlement, all investors who were unable to withdraw their funds when the investment program collapsed will receive full recovery of their invested assets.

Additionally, Gemini is prohibited from conducting any crypto lending programs in the state of New York.

The NYAG initially filed a complaint in October against Gemini, along with Genesis and Digital Currency Group (DCG).

The complaint alleged that Gemini misled investors and made false assurances about the low risk associated with investing in the Earn program through Genesis.

The NYAG also accused DCG, Genesis, and two executives of concealing $1.1 billion in losses through a campaign of misstatements and omissions.

Gemini recently announced that Earn users would receive $2.18 billion worth of their cryptocurrencies in-kind, meaning they would be refunded with the same digital assets they had initially invested.

According to Gemini, these distributions represent a 232% recovery from the time when withdrawals were halted in November 2022.

Gemini assured customers that the final Earn distributions would be available in their accounts within seven days.

Gemini to Distribute Over $2B Among Earn Users

In late May, Gemini announced the full recovery of digital assets for its Earn program users.

The recovery plan includes a $1.1 billion settlement. It ensures that users will receive the entirety of their assets, potentially exceeding the initial value due to asset appreciation during the holding period.

The distributions also represent a 232% recovery from when withdrawals were halted in November 2022.

Gemini offered an optional program called Earn, where customers could lend their crypto holdings to the company for interest.

Launched in early 2021 with Genesis, the program promised a return of 7.4% on deposits.

However, Gemini was forced to shut down Earn in Jan. 2023 after Genesis failed to repay over $900m in assets owed to Gemini.

More Articles

Altcoin News
Crypto.com Can Now Expand Services to All European Economic Area Member States
Ruholamin Haqshanas
Ruholamin Haqshanas
2025-02-12 16:01:23
Blockchain News
Thai Police Arrest Four Russians for Crypto Ransomware Attack on Swiss Companies
Jimmy Aki
Jimmy Aki
2025-02-12 15:34:46
Crypto News in numbers
editors
Authors List + 66 More
2M+
Active Monthly Users Around the World
250+
Guides and Reviews Articles
8
Years on the Market
70
International Team Authors