Genesis to Pay SEC $21M Penalty to Settle Charges Over Gemini Earn Product

CoinDeskPolicyPublished on 2024-03-18Last updated on 2024-03-19

Abstract

The settlement comes days after a New York judge denied motions by Genesis and crypto exchange Gemini to stop the SEC case.

Genesis Global Capital will pay $21 million as a civil penalty in a settlement with the SEC that has now been formalized.
The SEC will not receive any "portion of the penalty until after payment of all other allowed claims," the regulator said in a statement.

Bankrupt crypto lender Genesis Global Capital has agreed to a final judgment ordering it to pay $21 million to settle charges with the U.S. Securities and Exchange Commission (SEC) for violating securities laws for its role with the now-defunct Gemini Earn program, the SEC announced Tuesday.

The settlement comes days after a New York judge denied motions by Genesis and crypto exchange Gemini to stop the SEC case filed in January 2023 from moving forward. Genesis and two affiliates had filed for bankruptcy shortly after the SEC charges.

In February 2024, Genesis said in court documents it had agreed with the SEC to settle the charges for $21 million, and it appears the deal has now been finalized.

Critically, the SEC will not receive any "portion of the penalty until after payment of all other allowed claims by the bankruptcy court," the announcement said.

“Today’s settlement builds on previous actions to make clear to the marketplace and the investing public that crypto lending platforms and other intermediaries need to comply with our time-tested securities laws," said SEC Chair Gary Gensler in a statement.

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Edited by Nikhilesh De.

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