Gemini will make this payment as settlement of the New York cryptocurrency fraud claim. Gemini is also prohibited from operating lending programs in New York.
Letitia James, Attorney General of New York Announce Her office has successfully received $50 million from cryptocurrency platform Gemini. These funds will be used to compensate investors who were through their Gemini Earn program.
The lawsuit claims Gemini defrauded investors out of more than $3 billion. He points to internal Gemini documents to argue that the exchange was aware of the “high risks” related to the program.
“Hundreds of thousands of people, including at least 29,000 New Yorkers, had their trust broken and their money misappropriated by Gemini through its fake Earn program,” Attorney General James said. “Gemini marketed its Earn program as a way for investors to grow their money, but in reality it lied and denied investors access to their accounts. Today's settlement will leave defrauded investors intact and should remind cryptocurrency companies that defrauding investors is illegal and will not be tolerated by my office.”
Gemini will return $50 million in digital assets to Gemini Earn investors who were unable to access their accounts. These refunds will be for over 230,000 investors. No action is required on the part of investors to recover their digital assets.
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Gemini Earn offered attractive interest rates to investors who lent cryptocurrencies to Genesis Global Capital, a unit of Digitalency Group. Gemini charges the agent a fee of over 4% for this service.
In November 2022, Genesis suspended redemptions following the collapse of cryptocurrency exchange FTX. Genesis later filed for Chapter 11 bankruptcy, leaving investors scrambling for their investments.
Gemini is run by billionaire twin brothers Cameron and Tyler Winklevoss.
