Image: © salarko/Stock.adobe.com
Founded by the Winklevoss twins, Gemini, which has its European HQ in Dublin, will pay a $37m fine to the New York State Department of Financial Services.
US crypto exchange Gemini will return at least $1.1bn to customers of its defunct Earn lending programme. Customers have not been able to access their funds since late 2022.
A statement from the New York State Department of Financial Services published yesterday (28 February) showed that Gemini has agreed to return the sum to its customers through the Genesis Global Capital bankruptcy proceeding.
As part of this proceeding, the company – which lets people buy and sell crypto assets such as bitcoin – will also pay a $37m fine to the department for “significant failures that threatened the safety and soundness of the company”.
The department also said that it has the right to bring further action against Gemini if it does not fulfil its obligation to return the sum to customers of its Earn programme.
Offered in partnership with crypto lender Genesis, the Earn programme was halted during a crypto market crash in November 2022. This caused Genesis to file for bankruptcy and triggered a legal battle between the two parties.
“Gemini failed to conduct due diligence on an unregulated third party, later accused of massive fraud, harming Earn customers who were suddenly unable to access their assets after Genesis Global Capital experienced a financial meltdown,” said department superintendent Adrienne Harris. “Today’s settlement is a win for Earn customers, who have a right to the assets they entrusted to Gemini.”
The company was founded in 2014 by Cameron and Tyler Winklevoss, the famous twins who claimed Mark Zuckerberg stole their idea in founding Facebook.
In July 2022, Gemini became the first virtual asset service provider registered by the Central Bank of Ireland, giving it a green light to provide crypto services to individuals and institutions in the Irish market. It launched its services in Ireland later that year.
The crypto exchange announced Dublin as its European headquarters last May in an effort to expand its footprint in Europe.
Gillian Lynch, who heads Gemini in Ireland and Europe, said at the time that Dublin was chosen because it is “a hub for innovation and technology, with a thriving start-up scene and deep talent pool”.
Find out how emerging tech trends are transforming tomorrow with our new podcast, Future Human: The Series. Listen now on Spotify, on Apple or wherever you get your podcasts.
