Genesis Global Settles Bankruptcy Case Brought by New York State Attorney General – 09/02/2024 at 1:08 pm

(Automatic translation by Reuters, please see disclaimer

Cryptocurrency bank Genesis Global has settled a lawsuit that New York’s attorney general filed against it last year, removing a major legal burden as it fights through its bankruptcy proceedings.

Attorney General Letitia James had sued the company, its parent Digital Currency Group (DCG) and cryptocurrency firm Gemini Trust Co in October for allegedly “defrauding” investors of more than $1 billion.

According to Mr. James, Genesis allegedly defrauded investors through an investment scheme called Gemini Earn, which it ran with its former partner Gemini.

The Earn program allowed Gemini customers to lend their crypto assets to Genesis and earn interest in exchange.

The settlement agreement filed Thursday, which must be approved by the Bankruptcy Court for the Southern District of New York, indicates that Genesis has agreed to cease operations in New York state.

Last week, Genesis also settled a lawsuit filed by the US Securities and Exchange Commission over the Pata deal, agreeing to a $21 million fine that will be paid only if the company is able to repay its customers in full in the context of bankruptcy.