Big News for Gemini Earn users. Today, Gemini Earn users impacted by Genesis bankruptcy in 2022 received $2.18 billion of their digital assets in kind, over $1 billion more than expected. These initial distributions represent:
- 97% of digital assets owed to Earn users
- $1 billion more than when Genesis halted withdrawals
- A 232% recovery from when Genesis halted withdrawals
The notional dollar value of digital assets returned to Earn customers is based on digital asset prices as of May 28, 2024, at 10 am ET.
What Happened?
Gemini customers enrolled in the Gemini Earn program to earn increased interest rates by locking up their crypto assets for staking. However, the now-defunct crypto lending platform Genesis facilitated the financial framework behind this program.
Three months after FTX collapsed in November 2022, Genesis declared bankruptcy, freezing assets belonging to Gemini Earn customers.
Earlier Settlement with NYDFS
In February this year, Gemini settled with the New York Department of Financial Services (NYDFS) to reimburse approximately $1.1 billion to its Gemini Earn customers. These customers could not withdraw their funds around the same time that the crypto exchange FTX collapsed.
Initial Expectations vs. Reality
In December 2023, reports suggested Gemini Earn users might receive only 61% of their crypto’s value from January 19, 2023, the date Gemini filed for bankruptcy.
An Unexpected Recovery
This recovery is unprecedented among crypto bankruptcies, and even bankruptcies in general. It follows Gemini’s previous announcement of a settlement in principle with Genesis and other creditors in the Genesis Bankruptcy. This settlement means all Earn users will receive 100% of their digital assets back in kind.
For example, if an Earn user lent one bitcoin, they will receive one bitcoin back. They will also receive any appreciation of their assets since they lent them into the Earn program.
To ensure this successful resolution, Gemini contributed $50 million to the Earn users’ recovery. Today’s initial distributions represent approximately 97% of the digital assets in the Earn program. Users can expect to receive their remaining asset balance within the next 12 months.
Gemini Continues To Be a Safe Exchange
Gemini is thrilled to have achieved this recovery for its users. They recognize the hardship caused by this lengthy process and appreciate the continued support and patience of their users.
It’s important to note that the Genesis bankruptcy was not a crypto problem. It was old-fashioned financial fraud compounded by a lack of regulatory clarity. Gemini vows to continue to fight for clear rules and guidance for the industry that foster both innovation and consumer protection.
Read our Gemini review to find out why we consider it one of the safest crypto exchanges. Gemini’s return of over $1 billion more than when Genesis halted withdrawals underscores its commitment to its users. This move solidifies Gemini as a leading and safe crypto exchange that puts its users first.
