Gemini Space Station won an arbitration case in August, with an arbitrator finding that the crypto exchange did not mislead users and was not responsible for the collapse of its Earn lending program, according to CNBC. The claim was filed by an Earn user in late 2024. The ruling said there was not enough evidence to show Gemini lied to customers or acted negligently in its due diligence on Genesis Global Capital, its main lending partner in the program. Gemini launched Earn in 2021, offering users up to 7.4% annual yield for lending out crypto. Under the structure, assets were lent to institutional borrowers through Genesis. Gemini halted withdrawals from Earn in November 2022, shortly after Genesis stopped new loan originations and redemptions because of a liquidity crisis tied to the 2022 crypto market downturn. The freeze triggered legal complaints from multiple customers. New York’s attorney general also sued Gemini over Earn and reached a $50 million settlement with the company in 2024. In February 2024, Gemini said it had reached an agreement in principle with Genesis and other creditors in the Genesis bankruptcy case. Three months later, Earn users received $2.18 billion in digital assets in kind, equal to 97% of the digital assets owed to them and $1 billion more than the value at the time withdrawals were halted in 2022.
Gemini Space Station won an arbitration ruling in August, with the arbitrator finding that the crypto exchange did not mislead users and was not liable for the collapse of its Earn lending program, according to CNBC.
The claim was brought by an Earn user in late 2024. The ruling said there was not sufficient evidence to prove that Gemini lied to customers or was negligent in its due diligence on Genesis Global Capital, the program’s main lending partner.
How the Earn program was structured
Gemini launched Earn in 2021, allowing users to lend out crypto in return for yields of as much as 7.4% annually. Under the program, Gemini lent assets to institutional borrowers, with Genesis acting as the intermediary.
In November 2022, Gemini suspended withdrawals from Earn, angering some of the more than 300,000 users in the program. That move came shortly after Genesis halted new loan originations and redemptions because of a liquidity crisis tied to the crypto market slump that year.
After Earn withdrawals were frozen, multiple customers filed legal complaints against Gemini. New York’s attorney general also sued the company over the Earn program and reached a $50 million settlement with Gemini in 2024.
Bankruptcy case and user recovery
In February 2024, Gemini said it had reached an agreement in principle with Genesis and other creditors in the Genesis bankruptcy case.
Three months later, Earn users received $2.18 billion in digital assets in kind. Gemini said that amount was equal to 97% of the digital assets owed to Earn users, and $1 billion more than the value at the time Genesis halted withdrawals in 2022.
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