In 2022, Gemini's financial product Gemini Earn suffered asset losses due to its partner Genesis being affected by the bankruptcy of FTX. As a result, Gemini Earn was suspended and withdrawals were suspended.

(Gemini and DCG were sued by New York law enforcement! They failed to disclose financial risks and were suspected of defrauding users of US$1.1 billion)

The cryptocurrency exchange, owned by tech billionaire twin Winklevoss brothers, has delivered on its promise to users after suspending withdrawals 18 months ago.

Refunding $2.2 billion to Earn users

Gemini announced on Wednesday that it will return $2.18 billion in digital assets to users of the Earn program. Withdrawals were suspended in November 2022 due to complications with its lending partner Genesis Global Capital.

(The exchange Gemini officially accused Genesis parent company DCG and founder Barry Silbert of conspiring to commit fraud)

Gemini told users that approximately 97% of the digital assets owed by Genesis as of the suspension date (November 16, 2022) were available for use in Gemini accounts.

Gemini is fully refundable with interest

The email is a follow-up to previous talks about a settlement with Genesis and other creditors in the Genesis bankruptcy case. Gemini assures users that they will recycle all digital assets on a pro-rata basis.

(The Attorney General’s Office settled with Genesis and fined $2 billion, a New York state record)

The email states: “If you lend one Bitcoin in the Earn program, you will get one Bitcoin back. This also means you will get back any and all increases in value since you loaned the asset.”

Centralized platform traceable results: 232% return

According to CNBC, the $2.18 billion release represents a 232% return of user assets since Gemini froze customer withdrawals from its Earn program 18 months ago. It is a positive turn for users who face locked-up funds and uncertainty.

What is the Gemini Earn program? Why the loss?

Just like the debt or financial products of Taiwanese companies, it allows users to deposit cryptocurrency to earn interest income.

First launched in 2021, the Earn program allows customers to earn high returns by depositing cryptocurrencies into Gemini. Gemini then lends these cryptocurrencies to institutional borrowers through Genesis Global Capital.

However, in November 2022, Genesis Global Capital suspended earnings distributions and redemptions, causing Gemini to suspend withdrawals from the Earn program. Genesis then filed for Chapter 11 bankruptcy protection in January in Manhattan federal court.

Last week, the New York state attorney general announced a $2 billion settlement with Genesis to repay defrauded investors. Only then did Gemini Earn come to an end.

What about Taiwan? Steaker was not sued and compensation was extended to the second stage

Steaker, a Taiwanese digital asset management platform that was also affected by FTX and was unable to withdraw funds, currently has its compensation plan in the second phase (2024/4) and issued 219,100 USDC. Recently, FTX has announced that it can obtain an excess compensation of 118%. Currently, Steaker has no relevant public corresponding information.

User case repayment 19%

According to user cases investigated by Lianxin News, 19% of the loans have been repaid so far.

(FTX still has 9% interest available, and creditors under $50,000 will receive 118% of the claimable amount within 60 days)

Steaker has not been sued, and the founder is expected to apply for state compensation

This type of wealth management product has been discussed in Taiwan over concerns about "attracting money", and various exchanges have also stopped the public operation of debt products. The founder of Steaker was detained and banned from seeing him at the time of the crime, and was subsequently detained for 51 days. He was finally released on bail with NT$3 million in February 2023.

(The founder of Steaker has illegally made hundreds of millions of dollars, and the founder of Steaker has threatened to ban him; NBA P. LEAGUE+ announced the termination of cooperation)

The case has not been prosecuted so far. According to Article 1 of the Criminal Compensation Act, "[t]he person who was detained or detained before being punished for impunity or insufficient suspicion of crime was not prosecuted or the prosecution was withdrawn, the prosecution was dismissed, or the verdict of not guilty was determined." Appraisal of detention or containment", you will be able to apply for state compensation.

At present, FTX states that it can fully compensate. Depending on how much of the user assets operated by Steaker at the time were "non-stable coins", which may be affected by low liquidation prices, stable coin assets should also be able to be repaid with interest.

This post is frozen for 18 months! Gemini financial products will refund users US$2.18 billion, with interest of 232%. What about Taiwan? First appeared in Chain News ABMedia.