July 24, 2024
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Winklevoss-Founded Gemini Trust Agrees To Pay $50 Million To Settle New York Crypto Fraud Claims

Winklevoss-Founded Gemini Trust Agrees To Pay $50M To Settle New York Crypto Fraud Claims
  • Resolving the claims brought by New York’s Attorney General, crypto exchange Gemini Trust has agreed to pay $50 million.
  • Gemini will now be banned from operating a crypto lending program in New York.

Gemini Trust, a cryptocurrency exchange, has consented to a $50 million settlement over fraud allegations.

A report on Friday cited by Bloomberg revealed that Gemini was sued by Attorney General Letitia James in October. The exchange was accused of misleading over 230,000 investors about the risks of its investment program, Gemini Earn.

As part of the settlement, Gemini will return approximately $50 million in digital assets to investors who were unable to access their accounts when the program collapsed. Furthermore, Gemini will be barred from operating a crypto lending program in New York.

James stated, “Hundreds of thousands of people, including at least 29,000 New Yorkers, had their trust broken and their money swindled by Gemini through its bogus Earn program.” 

This settlement comes in the wake of a series of investigations initiated by James, targeting the crypto industry.

This settlement marks a significant development in the ongoing scrutiny of the crypto industry by regulatory authorities. It serves as a stark reminder for crypto companies about the legal implications of misleading investors.

The case also highlights the risks associated with crypto lending programs, which have come under increased regulatory scrutiny in recent times. 

The settlement could potentially influence the operations of other crypto exchanges and lending programs, prompting them to ensure compliance with regulatory norms to avoid similar legal repercussions.