Gemini has reached a $50 million settlement with the New York Attorney General’s Office to compensate users who were affected by the Gemini Earn program. This agreement marks the end of a lawsuit that began in October 2023.
New York Attorney General Letitia James stated that Gemini had deceived hundreds of thousands of people, including 29,000 New Yorkers, through its fraudulent Earn program. The program falsely promised investors a way to increase their funds but instead prevented them from accessing their accounts. The settlement aims to reimburse affected investors and serve as a warning to cryptocurrency companies against deceptive practices.
As part of the settlement, Gemini will return all assets to defrauded investors within seven days, allowing them to access their funds through their accounts. The Earn program impacted a total of 230,000 users, both within and outside of New York state. Furthermore, Gemini has agreed to discontinue any lending programs within the state.
The lawsuit alleged that Gemini had misled investors about the risks associated with the Earn program, leading to the loss of their assets when they were unable to retrieve them. The program was operated in partnership with Genesis Capital Group, which was previously sued by Letitia James for $2 billion in connection to the same program.
In addition to the settlement with Gemini, the New York Attorney General’s Office is pursuing a case against Digital Currency Group, CEO Barry Silbert, and former CEO Soichiro Moro. Letitia James has a track record of holding digital asset businesses accountable for defrauding investors, as demonstrated by previous cases against KuCoin and Nexo.
Looking ahead, James is preparing for a lawsuit against former Celsius founder Alex Mashinsky scheduled for January 2025. Her efforts to protect investors and uphold the law in the cryptocurrency industry have established her as a formidable figure in the pursuit of justice.