Crypto exchange Gemini said its defunct Earn product users will begin receiving approximately 97% of their frozen digital assets by the end of this month.
According to a recent statement, the exchange clarified:
“As a reminder, the initial distributions will be in kind. This means, for example, that if you had lent one bitcoin in the Earn program (as of November 16, 2022 — the date Genesis suspended redemptions), you will receive one bitcoin back. And it means that you will receive any and all appreciation of your assets since you lent them into the Earn program.”
Notably, the exchange’s announcement coincided with news that the failed crypto lender Genesis got Court approval to return around $3 billion of its customers’ assets.
Meanwhile, this development marks a significant relief for Earn users, whose assets have been frozen since November 2022 due to the liquidity crisis that hit Genesis, the now-bankrupt crypto lender.
The community has broadly welcomed Gemini’s plan, especially given the substantial increase in asset values since 2022. For example, Bitcoin’s average price has surged to over $67,000, while Ethereum’s price has risen to over $3,000.
Gemini Earn is an interest-bearing product that has been controversial since Genesis filed for bankruptcy last year. The program was suspended in January 2023 after the crypto trading platform terminated the Master Loan Agreements with Genesis.
Since then, Gemini has pursued extensive legal action against Digital Currency Group, Genesis’s parent company, on behalf of over 200,000 Earn users. Gemini alleges that Digital Currency Group was aware of Genesis’s insolvency since 2022 but failed to inform investors.
The Earn program also attracted regulatory scrutiny from the New York State Department of Financial Services (NYDFS) and the US Securities and Exchange Commission (SEC), both alleged violations of federal securities laws. Gemini has since settled with both regulators.