Crypto News– In a recent update regarding Gemini Genesis, it has come to light that Gemini Trust Co. executed a significant maneuver several months prior to the financial turbulence that Genesis Global Holdco LLC encountered, which eventually led to a freeze on deposits and the declaration of bankruptcy.
Gemini Genesis Update: Bankruptcy Looms as 282 Million Dollars Withdrawal Comes to Light
According to two undisclosed sources, Gemini Trust Co., owned by Tyler and Cameron Winklevoss, withdrew an approximate sum of $282 million in cryptocurrency from Genesis in August 2022.
Strategic Allocation by Gemini
Contrary to prevailing speculations, the funds withdrawn were not intended for the personal use of the Winklevoss twins. Instead, they were earmarked to establish a reserve fund designed to facilitate prompt redemptions for customers utilizing Gemini Earn services.
This situation grew complex in the wake of FTX’s collapse, which reverberated throughout the highly volatile cryptocurrency market. Subsequently, Genesis suspended customer withdrawals, ultimately filing for Chapter 11 bankruptcy protection in New York in January. In response, Gemini filed a claim seeking $1.1 billion on behalf of Earn program users.
Since the initial suspension of withdrawals, negotiations involving Gemini, Genesis, and Digital Currency Group have been ongoing, marked by public disputes between Barry Silbert, the founder of DCG, and the Winklevoss twins. A tentative agreement reached in February remained unresolved, culminating in a lawsuit initiated by Gemini against DCG for alleged fraud in July.
Furthermore, both Genesis and Gemini found themselves entangled in legal matters with the US Securities and Exchange Commission in January. The SEC alleged that the Earn program constituted an unregistered offering and sale of securities.
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