Bankrupt Genesis settles SEC lawsuit over Gemini Earn program
Bankrupt Genesis Global Holdco has agreed to settle a lawsuit filed by the Securities and Exchange Commission a year ago regarding its loan program.
Genesis, a subsidiary of Digital Current Group, has agreed to pay $21 million to the SEC to settle the lawsuit, according to documents filed in U.S. Bankruptcy Court for the Southern District of New York.
“The settlement agreement is the product of extensive negotiations between the SEC and GGC,” according to the Jan. 31 filing. “The proposed settlement will resolve the civil litigation claims brought by the SEC, among other benefits to the Debtors’ estate.” “It eliminates the risks, costs and uncertainty associated with lengthy litigation with the SEC in Chapter 11 cases.”
The $21 million will be paid “after payment in full of all other permitted administrative fees, collateral, priority and general unsecured claims,” according to court documents.
SEC lawsuit
The settlement resolves a civil lawsuit filed against Gemini and Genesis a year ago. The SEC charged Genesis Global Capital and Gemini Trust Company, which offers and sells securities unregistered to retail investors through the Gemini cryptocurrency lending program.
Apply for Genesis Global Holdco bankruptcy It was placed into protection in January 2022 after suffering a financial blow from the collapse of cryptocurrency hedge fund Three Arrows Capital and cryptocurrency exchange FTX.
The digital currency group did not immediately respond to a request for comment. The SEC declined to comment.
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About the author
Sarah is a reporter for The Block covering policy, regulation and legal events. Sarah was previously a reporter writing about securities regulation at CQ Legal, where she first began her reporting on cryptocurrencies. She Sarah has also written for The Bond Buyer and American Banker, among other financial publications. She graduated from the University of Missouri with a degree in Print and Digital Journalism. Sarah lives in Washington, DC and she is an avid coffee lover. You can follow her on Twitter @ForTheWynn.
