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FinanceArbitrator rules Gemini not liable for collapse of Earn lending program
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A legal arbitrator has ruled that cryptocurrency exchange Gemini, led by Tyler and Cameron Winklevoss, cannot be held liable for the collapse of its Earn lending program. The arbitrator found insufficient evidence that Gemini misled users or failed to conduct due diligence. The program's failure was attributed to 'massive fraud' committed by Genesis, Gemini's partner in the program. Genesis had previously agreed to pay a $38.5 million fine to the SEC for misleading investors. Launched in 2021, Earn allowed users to earn up to 7.4% annual interest by lending their cryptocurrency through Gemini to institutional borrowers via Genesis. Withdrawals were halted in 2022 after Genesis paused loan originations due to a liquidity crunch, affecting over 300,000 users. Investors filed a lawsuit in 2024, and the New York Attorney General also sued Gemini, settling for a $50 million fine. In February 2024, Gemini settled with Genesis and has since repaid $2.18 billion in digital assets, representing 97% of what was owed to Earn users. Gemini's stock has declined 87% since going public a year ago, currently trading at $4.30.
Source report
Editorial Staff Mon, August 31, 2026 at 7:22 AM PDT 2 min read
A legal arbitrator has ruled that cryptocurrency exchange Gemini (NASDAQ: $GEMI) cannot be held liable for the collapse of its Earn lending program.
Specifically, the arbitrator in the case stated that Gemini, led by twin brothers Tyler and Cameron Winklevoss, did not mislead users and was not at fault for the failure of the Earn lending program.
The legal claim was filed by investors in 2024 following the program's collapse. The arbitrator found insufficient evidence that Gemini lied to customers or failed to conduct proper due diligence.
The arbitrator determined that the Earn lending program failed largely due to "massive fraud" committed by Genesis, which had partnered with Gemini on the program.
Last year, Genesis agreed to pay the U.S. Securities and Exchange Commission (SEC) a fine of $38.5 million for misleading investors.
Launched in 2021, Earn allowed users to earn up to 7.4% in annual interest on their cryptocurrency holdings by lending them out. Gemini lent the digital assets to institutional borrowers, using Genesis as its intermediary.
However, Gemini halted withdrawals from its Earn program in 2022, angering its more than 300,000 users. The move came after Genesis paused loan originations due to a liquidity crunch.
Following the Earn withdrawal freeze, investors filed a lawsuit against Gemini. The New York Attorney General also sued Gemini, settling with the company for a $50 million fine.
In February 2024, Gemini reached a settlement with Genesis and has since repaid $2.18 billion of digital assets in kind to investors, representing 97% of what was owed to Earn users.
GEMI stock has declined 87% since the company went public a year ago. The shares are currently trading at $4.30 each.
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Source
Yahoo FinanceWestern
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Arbitrator rules Gemini not liable for collapse of Earn lending program, blames Genesis fraud