In a groundbreaking development, cryptocurrency exchange Gemini has agreed to pay $50 million to settle a fraud case in New York.
New York Attorney General Letitia James announced today that the state is recovering $50 million as part of a settlement agreement with cryptocurrency exchange Gemini. Recovered funds will be returned to Gemini Earn customers involved in a multi-company bankruptcy process.
Gemini has agreed to cooperate in a massive $3 billion fraud lawsuit against former partners Digital Currency Group (DCG), DCG founder and president Barry Silbert, and former president of the now-defunct Genesis, Soichiro” Michael” Moro.
The lawsuit filed against Gemini by New York in October accused the exchange of misleading investors about its Gemini Earn product. The product involved former DCG partners and the Genesis bank branch.
Although Earn customers’ previously frozen funds have been returned, the long-running dispute between Gemini founders Cameron and DCG’s Tyler Winklevoss and Silbert is not over.
The NYAG lawsuit, amended in February, alleges that the group defrauded investors of more than $3 billion. Citing internal Gemini documents, the indictment alleges that the exchange was aware that Genesis Capital presented a “high risk.” Cameron Winklevoss has been outspoken in his criticism of the firm’s former partners, regularly writing angry letters against them and directly calling for Silbert’s removal from DCG.
*This is not investment advice.
