Gemini will return $2.18B in consumer revenue following an 18-month withdrawal ban
Crypto exchange Gemini has started the process of returning the proceeds of its now discontinued loan program to users.
According to an announcement, Gemini Earn users were paid $2.18 billion in digital assets on May 29, representing 97% of the assets owed to users and a 232% recovery following the termination of funding by Genesis, a former Gemini Earnings partner.
“This means, for example, if you lend one bitcoin through the Earn program, you will get one bitcoin back. And the Get Money for Your Wealth program means you'll receive any and all accolades after you borrow,” the statement says in X.
The distribution of funds is the result of an agreement with Genesis and other creditors in bankruptcy proceedings. Genesis Global, the crypto-lender arm of Digital Currency Group (DCG), filed for bankruptcy in January 2023 after ceasing issuance in November 2022 amid a liquidity crisis. A court recently approved the return of Genesis' $3 billion in cash and cryptocurrency to creditors. .
“This represents an unprecedented recovery among crypto losses […] We have reached an agreement in principle with Genesis and other lenders. […] This ensures that all incoming users receive 100% of their digital assets in kind.
New York Attorney General Leticia James announced on May 20 that her office reached a $2-billion settlement with Genesis to settle investor fraud claims. The settlement ordered Genesis to return the money to investors and cease operations in New York. Genesee has been accused of misleading investors who invested more than $1.1 billion in the Gemini Earnings program.
“Finally, it's important to note that the Genesis breach is not a crypt problem. It was an old financial scam compounded by a lack of regulatory transparency,” Gemini said in a statement. Genesis was one of several crypto firms to file for bankruptcy in November 2022 following FTX's dramatic debacle.
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