CDS Crypto News Genesis Chooses Bankruptcy Settlements Over 21 Million Dollars Penalty Distribution
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Genesis Chooses Bankruptcy Settlements Over 21 Million Dollars Penalty Distribution

Genesis Global Capital has reached a settlement with the SEC, agreeing to pay a $21 million civil penalty.

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Genesis Chooses Bankruptcy Settlements Over 21 Million Dollars Penalty Distribution

Crypto News- Genesis Global Capital found itself in hot water, agreeing to cough up a hefty $21 million in civil penalties following allegations of conducting unregistered security sales via Gemini Earn. The United States Securities and Exchange Commission (SEC) wasted no time in flexing its regulatory muscle, ensuring a permanent injunction against further malpractice.

However, there’s a twist in the tale: before Genesis forks over a single cent to the SEC, all bankruptcy claims must be settled in full. Notably, among these claims are those from retail investors who participated in Gemini Earn.

Genesis Chooses Bankruptcy Settlements Over 21 Million Dollars Penalty Distribution

SEC Chair Gary Gensler minced no words in expressing the severity of the situation, emphasizing Genesis’ failure to adhere to registration protocols, a cornerstone of investor protection. “Today’s settlement,” he asserted, “serves as a stark reminder to crypto lending platforms: compliance with securities laws is not negotiable. It’s about safeguarding investors and upholding market integrity.”

Echoing Gensler’s sentiment, Gurbir S. Grewal, Director of the SEC’s Division of Enforcement, highlighted the repercussions of flouting federal securities laws, citing the collapse of the Gemini Earn program as a cautionary tale. “Investor protection disclosures,” they emphasized, “aren’t just optional add-ons; they’re non-negotiable requirements.”

The genesis of this saga dates back to January 12, 2023, when the SEC leveled charges against both Genesis and Gemini Trust Company. At the heart of the matter was the Gemini Earn initiative, enticing retail investors to loan their crypto assets in exchange for promised interest payouts from Genesis. However, come November 2022, investors found themselves unable to access their assets due to Genesis’ liquidity woes, culminating in the company’s Chapter 11 bankruptcy filing on January 19, 2023.

Genesis Chooses Bankruptcy Settlements Over 21 Million Dollars Penalty Distribution

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