{"id":79509,"date":"2023-05-29T15:45:00","date_gmt":"2023-05-29T12:45:00","guid":{"rendered":"https:\/\/forklog.com\/en\/?p=79509"},"modified":"2025-09-11T11:26:19","modified_gmt":"2025-09-11T08:26:19","slug":"gemini-and-genesis-challenge-sec-suit-over-earn-program","status":"publish","type":"post","link":"https:\/\/u1f987.com\/en\/gemini-and-genesis-challenge-sec-suit-over-earn-program\/","title":{"rendered":"Gemini and Genesis challenge SEC suit over Earn program"},"content":{"rendered":"<p>Genesis Global Holdco, undergoing<a href=\"https:\/\/u1f987.com\/en\/news\/genesis-part-of-digital-currency-group-files-for-bankruptcy\"> bankruptcy proceedings<\/a> and the bitcoin exchange Gemini filed in court a <a href=\"https:\/\/storage.courtlistener.com\/recap\/gov.uscourts.nysd.592343\/gov.uscourts.nysd.592343.30.0.pdf\">motion<\/a> to dismiss the <span data-descr=\"Securities and Exchange Commission\" class=\"old_tooltip\">SEC<\/span> lawsuit against their joint Earn program.<\/p>\n<p>In January 2023, the Commission<a href=\"https:\/\/u1f987.com\/en\/news\/sec-accuses-gemini-of-selling-unregistered-securities\"> accused<\/a> partners of selling unregistered securities. The suit confirmed media reports of Genesis Global Holdco <a href=\"https:\/\/u1f987.com\/en\/news\/ft-reports-genesis-and-dcg-owe-gemini-clients-900-million\">indebtedness to the exchange&#8217;s clients totaling $900 million<\/a>. The interests of 340,000 investors were affected.<\/p>\n<p>At that time, Gemini co-founder Tyler Winklevoss called the SEC&#8217;s allegations &#8216;extraordinarily unconvincing&#8217; and &#8216;a fabricated penalty ticket&#8217;.<\/p>\n<p>In the current motion, the firms noted that interpreting the three-party loan agreement on key digital assets (MDALA) between Genesis, Gemini and Earn users as an unregistered security &#8220;has no legal or factual basis&#8221;.<\/p>\n<p>Lawyers stressed that the SEC failed to &#8216;properly prove&#8217; that MDALA is an investment contract, and to provide convincing grounds for the claims that the agreements were disseminated to third parties.<\/p>\n<p>In May, Digital Currency Group (DCG), Genesis&#8217; parent company<a href=\"https:\/\/u1f987.com\/en\/news\/dcg-misses-630m-payment-to-gemini-earn\"> defaulted on a payment<\/a> of $630 million as part of compensation to Gemini Earn users.<\/p>\n<p>Earlier, DCG, Genesis, the creditors&#8217; committee of the crypto-lending platform and the exchange <a href=\"https:\/\/u1f987.com\/en\/news\/gemini-backs-dcgs-push-for-pre-litigation-settlement\"> agreed<\/a> to launch a 30-day pre-litigation settlement process.<\/p>\n<p>The parties seek an acceptable resolution under the <a href=\"https:\/\/u1f987.com\/en\/news\/genesis-reaches-preliminary-restructuring-agreement-with-creditors-reports-say\">Genesis creditors agreement<\/a> proposed in February 2023, under which the creditors would recover 80% of the lost funds. The arrangements envisaged a gradual write-down of Genesis&#8217;s loan portfolio and the sale of insolvent entities.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Genesis Global Holdco, undergoing bankruptcy proceedings, and the bitcoin exchange Gemini filed in court a motion to dismiss the SEC&#8217;s lawsuit against their joint Earn program.<\/p>\n","protected":false},"author":1,"featured_media":79510,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"select":"1","news_style_id":"1","cryptorium_level":"","_short_excerpt_text":"","creation_source":"","_metatest_mainpost_news_update":false,"footnotes":""},"categories":[3],"tags":[719,1380,36,128],"class_list":["post-79509","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news-and-analysis","tag-gemini","tag-genesis-global-capital","tag-regulation","tag-sec"],"aioseo_notices":[],"amp_enabled":true,"views":"16","promo_type":"1","layout_type":"1","short_excerpt":"","is_update":"","_links":{"self":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/79509","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/comments?post=79509"}],"version-history":[{"count":1,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/79509\/revisions"}],"predecessor-version":[{"id":79511,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/79509\/revisions\/79511"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/media\/79510"}],"wp:attachment":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/media?parent=79509"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/categories?post=79509"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/tags?post=79509"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}