New York Attorney General Letitia James has successfully reached a $50 million settlement with cryptocurrency exchange Gemini for investors in the Earn program. This agreement guarantees that all affected investors will be fully reimbursed for their investments that they were unable to withdraw when the program collapsed. Furthermore, Gemini is now prohibited from running any crypto lending programs in New York.
Gemini to Give Back $50 Million in Digital Assets to Earn Investors
The office of New York Attorney General Letitia James revealed on Friday that she has recovered around $50 million from the cryptocurrency platform Gemini Trust Company LLC “for over 230,000 investors, with at least 29,000 being New Yorkers, who participated in the Gemini Earn program and were victims of fraud.”
According to the announcement, “Gemini allegedly deceived numerous investors regarding the risks linked to Gemini Earn, an investment program it conducted in partnership with another cryptocurrency company, Genesis Global Capital (Genesis).” The settlement ensures that all duped investors will receive full reimbursement for the assets they put into the Earn program but were unable to retrieve when the program faltered.
This recent settlement comes after Attorney General James’ $2 billion agreement with Genesis and concludes the claims against Gemini. The settlement prohibits Gemini from running any cryptocurrency lending programs in New York and requires the company to assist in the Attorney General’s legal action against Digital Currency Group (DCG), Barry Silbert, and Genesis’ former CEO Soichiro Moro.
The New York Attorney General’s Office also stated:
As per the settlement, Gemini will return approximately $50 million in digital assets to Gemini Earn investors who were locked out of their accounts.
Investors do not need to take any steps to reclaim their digital assets, and they will be able to access them in their accounts.
Attorney General James filed a lawsuit against Gemini last October, alleging that the company misled investors about the safety of its Gemini Earn program. Despite assuring investors that investing in the program with Genesis was low-risk, the lawsuit claimed that Gemini was aware that Genesis’ loans were not adequately secured and heavily reliant on a single entity, Sam Bankman-Fried’s Alameda, without disclosing these risks to investors. Just last month, Attorney General James secured a $2 billion settlement from Genesis to compensate the defrauded victims.
What are your thoughts on Gemini’s settlement with New York Attorney General Letitia James? Additionally, how do you feel about New York’s decision to prohibit Gemini from conducting any cryptocurrency lending programs in the state? Share your views in the comments below.
