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Gemini Earn Cryptocurrency Investors: New York Recovers $50 Million for Defrauded Gemini Earn Cryptocurrency Investors
New York Attorney General Letitia James said Friday that his office had recovered $50 million from the cryptocurrency platform Gemini Confidence repay investors defrauded in his Gemini Earn Program.
James said Gemini, run by billionaire twin brothers Cameron and Tyler Winklevoss, will provide full recoveries to more than 230,000 Earn investors, including 29,000 in New York, and agreed to a ban on operating cryptocurrency lending programs in the state.
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“Gemini marketed its Earn program as a way for investors to grow their money, but in reality it lied and locked investors out of their accounts,” James said. “Today’s settlement will save defrauded investors.”
Gemini Earn promised high interest rates to investors who lent crypto assets like bitcoin to cryptocurrency lender Genesis Global Capital, a unit of Digital Currency Group, with Gemini accepting agent commissions that could top 4%.
Investor money was frozen when Genesis stopped redemptions in November 2022, shortly after the collapse of Sam Bankman-Fried’s FTX cryptocurrency exchange. Genesis filed for Chapter 11 bankruptcy two months later.
Friday’s payment is in addition to the related $2 billion deal between James and Genesis announced on May 20.
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Gemini said Gemini Earn investors will get back more than they put in because they will be paid in digital assets such as bitcoin, which has more than tripled in value since redemptions were suspended. James said Gemini also agreed to cooperate in his fraud lawsuit filed in October against Digital Currency Group and its CEO, Barry Silbert. They called his claims unfounded.
The Winklevoss twins are each worth $2.7 billion, Forbes magazine said.