Technology
Wednesday, May 29th, 2024 4:03 pm EDT
Key Points
- Asset Return to Customers: Gemini will return $2.18 billion of digital assets to users of its Earn program, which had paused withdrawals in November 2022.
- Settlement and Full Recovery: The initial Earn distributions represent 97% of the digital assets owed as of the suspension date, following a settlement with Genesis and other creditors in the Genesis Bankruptcy, ensuring all Earn users will receive 100% of their assets back in kind.
- Background and Legal Actions: The Earn program was halted due to Genesis Global Capital pausing new loan originations and redemptions, leading to Genesis filing for Chapter 11 bankruptcy. Recently, a $2 billion settlement was announced by the New York Attorney General to repay defrauded investors.
Customers who had funds locked up in Gemini’s now-defunct crypto lending program, Earn, are finally seeing the return of their digital assets. Gemini, owned by tech billionaires Cameron and Tyler Winklevoss, announced that it will return $2.18 billion to users of the Earn program, which had paused withdrawals in November 2022. Gemini notified its customers via email, stating that initial distributions, approximately 97% of the digital assets owed to them by Genesis as of the suspension date, are now available in their Gemini accounts. This development follows a settlement reached with Genesis and other creditors in the Genesis Bankruptcy, ensuring that all Earn users will receive 100% of their digital assets back in kind. This means that if a customer had lent one bitcoin in the Earn program, they will receive one bitcoin back, including any increase in the value of their assets since they were lent.
The $2.18 billion fund distribution represents a significant 232% recovery for users since Gemini froze withdrawals 18 months ago. The Earn program, launched in 2021, allowed customers to earn high yields on their coins by storing them in Gemini’s scheme, which then lent the crypto to institutional borrowers through Genesis Global Capital, its lending partner. However, in November 2022, Genesis Global Capital paused new loan originations and redemptions, leading Gemini to halt withdrawals from the Earn program. Subsequently, Genesis filed for Chapter 11 bankruptcy protection in January in Manhattan federal court.
Adding to this resolution, the New York Attorney General announced a $2 billion settlement with Genesis last week to repay defrauded investors. This settlement marks a significant step toward resolving the issues faced by users of Gemini’s Earn program and reinstating their digital assets.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/05/29/winklevoss-crypto-exchange-gemini-returns-2point2-billion-to-users.html
