Gemini, the cryptocurrency exchange, reached a settlement with the New York Department of Financial Services (NYDFS) to repay $1.1 billion to customers following issues with its Earn program.
The NYDFS cited “compliance, management, and internal audit issues” with the program and imposed a $37 million fine on Gemini for these failures. The Earn program, launched in 2021, allowed customers to earn interest by loaning their cryptocurrency to Genesis Global Capital.
Superintendent Adrienne A. Harris: “#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…"
— NYDFS (@NYDFS) February 28, 2024
In an update published on its website, Gemini says that if the settlement is approved, it will result in “all Earn users receiving 100% of their digital assets back in kind.” The company says customers can expect to receive 97 percent of assets in around two months, while the remainder could arrive over the next year.
“We’ve worked tirelessly over the past 15 months to advocate for Earn users and seek the return of their assets,” Gemini says. “Being able to return assets on a coin-for-coin basis to our customers was critical for us.”
