Gemini To Pay Another $50 Million In Latest Settlement Over Earn Program

The New York Attorney General’s office on Friday said it has recovered approximately $50 million from cryptocurrency platform Gemini on behalf of more than 230,000 investors who participated in the company’s Earn program.

“Hundreds of thousands of people, including at least 29,000 New Yorkers, had their trust broken and their money swindled by Gemini through its bogus Earn program,” said Attorney General Letitia James in the release. 

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

This latest announcement is in addition to a $2 billion settlement that James’ office secured from Gemini’s Earn partner Genesis last month, which went to reimburse Gemini Earn users. 

With Gemini’s additional $50 million, investors will now be made completely whole on an “in-kind coin-for-coin basis,” the consent order states.

“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,” James said.

Both settlements allege that Gemini misled investors about the risks associated with the Earn program, which it offered in partnership with Genesis Global Capital. 

The agreement provides full recovery of the assets that investors were unable to withdraw when the program collapsed in November 2022. As part of the agreements—in which Genesis neither admitted nor denied the allegations—the company is also banned from operating in New York.

The agreement also requires the company to cooperate with the Attorney General’s ongoing litigation against Digital Currency Group, its CEO Barry Silbert, and Genesis’ former CEO Michael Moro.

Gemini will return approximately $50 million worth of digital assets directly to Earn investors within seven days, according to the consent order filed with the court. 

Affected investors will be able to access their digital assets in their accounts without taking separate action, according to the announcement. 

Gemini can no longer offer crypto lending products in New York, as well.

Last week, the New York Attorney General’s office announced a $1 billion lawsuit against a linked pair of crypto companies that James said “targeted immigrant and religious communities with promises of financial freedom but instead stole their money and drained their life savings.”