Startups to pay $21 million: settle the SEC case

Genesis Global Capital has agreed to pay a $21 million civil penalty as part of a final court order to settle claims related to the Gemini Earn loan program.

Genesis and Gemini were accused of issuing unregistered securities after launching the Gemini Earn money lending program for retail investors.

Gary Gensler, Chairman of the United States Securities and Exchange Commission (SEC), said in a March 19 statement. information:

“Today’s agreement builds on previous steps to make clear to markets and investors that crypto-lending platforms and third-party intermediaries must comply with our proven securities laws. This will better protect investors. It promotes confidence in the markets. This is not an option just. It’s the law.”

Under the terms of the settlement, the SEC will receive a portion of the penalty only after other bankruptcy payments, such as claims of retail investors, have been made.

The $21 million fine marks the end of a case the SEC filed in January 2023 against Gemini and Genesis for selling unregistered securities through the Gemini Earn program.

Genesis stopped payments on its platform in November 2022, when Gemini Earn had about 340,000 customers and $900 million in assets under management, the SEC said.

Three weeks earlier, Gemini agreed to pay a $37 million penalty for multiple compliance violations that “threatened the safety and soundness of the company,” according to New York State Department of Financial Services (NYDFS) Administrator Adrienne Harris. in the statement of February 28.

The $37 million penalty is part of a settlement between Gemini and the NYDFS, which states that. Gemini at least 1.1 billion dollars for Gemini Pata Software customers as part of Genesis’ bankruptcy proceedings.

If the bankruptcy court agrees, wait Geminithat Get users 100% of their cryptocurrency assets return plus added value.

“If approved, we will recover more than $1.8 billion (at today’s prices). That’s $700 million more than when Genesis made the November 16, 2022 payment freeze.”