- Genesis is now in the bankruptcy process, therefore the bankruptcy court must accept the deal.
- New York investors who lost money with the Gemini Earn program will get reparations.
A $2 billion settlement has been reached between the New York State Attorney General’s office and Genesis Global Holdco. Prolonged discussions stemming from allegations of misrepresenting Genesis-related financial activities led to this conclusion.
Genesis is now in the bankruptcy process, therefore the deal must be accepted by a bankruptcy court. Also, this settlement marks a significant change in the way crypto firms are regulated.
Landmark Settlement
Genesis and New York Attorney General Letitia James reached a landmark settlement, the largest of its kind in New York’s cryptocurrency regulatory history. Also, as part of the settlement, a victim fund would be established to assist investors from New York who had invested over $1.1 billion in Genesis via the Gemini Earn program.
Moreover, New York investors who lost money with the Gemini Earn program will get reparations from the victim fund that the business will create, according to the terms of the deal. The impacted creditors will receive up to $2 billion from this fund, which is derived from Genesis’ residual assets.
The firm’s downfall was brought on by a series of industry failures, including Three Arrows Capital and the FTX exchange, which led to its bankruptcy filing in January 2022. Legal procedures against other parties involved, such as Gemini Trust Company, LLC, might continue as a result of the settlement, which does not include the firm’s admission of guilt.
A crypto lending program run by Gemini was the subject of a lawsuit filed by New York Attorney General Letitia James against the cryptocurrency firm, Genesis, and Digital Currency Group (DCG), its parent firm.
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