The Gemini and Genesis saga has taken another twist with the announcement of a $100 million agreement between the two companies. The beleaguered Gemini Earn program has been at the center of a public battle between the two firms, with Genesis halting withdrawals in November 2022 and leading to a series of legal threats and counter-threats.
The situation reached its climax in January 2023 when the crypto brokerage firm Genesis filed for chapter 11 bankruptcy, citing the collapse of Three Arrow Capital and FTX as the main events that led to the filing. This was followed by a Securities and Exchange Commission investigation into the Gemini Earn program, which resulted in charges being filed against both Genesis and Gemini for violating securities laws.
However, with the announcement of this new agreement, there is finally some light at the end of the tunnel for Gemini Earn users. According to a press release sent to Decrypt, Gemini will contribute up to $100 million for Earn users, and the terms of the agreement with Digital Currency Group (DCG) include the sale of Genesis Global Trading. In addition, DCG will exchange its existing $1.1 billion note for convertible preferred stock and refinance its existing 2023 term loans.
3/ In addition, Gemini will be contributing up to $100 million more for Earn users as part of the plan, further demonstrating Gemini’s continued commitment to helping Earn users achieve a full recovery.— Cameron Winklevoss (@cameron) February 6, 2023
Cameron Winklevoss, co-founder of Gemini, took to Twitter to announce the agreement, calling it a “critical step toward a substantial recovery of assets for all Genesis creditors.” Derar Islim, Interim CEO of Genesis, expressed his gratitude to the team at Genesis and the company’s clients for their continued patience and loyalty as they work through a resolution for the lending business.
While there is still work to be done, Winklevoss is confident that there is a framework in place to move forward and recover assets for all Genesis creditors. The agreement between Gemini and Genesis may bring an end to the legal wrangling and help users get their money back. It remains to be seen how the SEC investigation will play out, but for now, it seems like there is a glimmer of hope for all those affected by the Gemini Earn program.