Gemini has struck a tentative deal with the U.S. Securities and Exchange Commission, potentially ending a high-profile lawsuit over its Earn lending program.
Summary
- Gemini and SEC reach tentative settlement over Earn lending program.
- Settlement follows Genesis’ bankruptcy, which froze $900M in customer assets.
- Announcement comes days after Gemini’s $425M IPO and strong market debut.
According to a recent court filing in Manhattan federal court, lawyers for both the SEC and Gemini, now operating as Gemini Space Station, said they had reached a settlement “in principle” to resolve the lawsuit tied to Gemini Earn fully.
The filing asked U.S. District Judge Edgardo Ramos to pause deadlines until Dec. 15 while the parties finalize paperwork. Neither Gemini nor the SEC provided immediate comment. The development was disclosed in a Sept. 16 report by Reuters.
Gemini Earn dispute and fallout from Genesis
Gemini Earn allowed customers to lend Bitcoin (BTC) and other cryptocurrencies to Genesis Global Capital in exchange for interest, with Gemini collecting fees of up to 4.29%. At its peak, the program attracted hundreds of thousands of users.
Trouble began in Nov. 2022, when Genesis froze withdrawals after FTX’s collapse. By January 2023, Genesis filed for bankruptcy, leaving $900 million in customer assets stranded from roughly 340,000 Gemini Earn users.
The SEC sued Gemini and Genesis that same month, claiming they sidestepped disclosure rules designed to protect investors. While Genesis later paid a $21 million penalty to settle without admitting wrongdoing, Gemini continued to contest the allegations.
The tentative agreement now signals an end to tha
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Author: Leon Okwatch
