Gemini has filed a lawsuit against crypto lender Genesis for the control of $1.6 billion in Grayscale Bitcoin Trust shares.
Gemini has filed a lawsuit against crypto lender Genesis for the control of $1.6 billion in Grayscale Bitcoin Trust shares.
Gemini Sues its Former Business Partner
Gemini and Genesis have been embroiled in a feud since 2022 over the Gemini Earn product. Genesis served as the primary lending partner to the New York-based exchange for this product. Gemini Earn was a high-yield product that promised depositors up to 8% yields.
According to the lawsuit, the shares currently in dispute “would completely secure and satisfy the claims of every single” customer who invested in Earn whose funds have been locked up since Genesis halted withdrawals.
In the lawsuit, Gemini alleges:
“Genesis has repeatedly taken actions to harm Earn users and to hinder and delay Earn users’ recovery of their digital assets.
It is time to resolve these issues so that Genesis may move forward with a reasonable plan of reorganization and Gemini may distribute the proceeds of the collateral to Earn users.”
In a blog post, Gemini further commented on the matter, saying:
“Genesis is the impediment to making the Earn Users whole. Genesis is seeking to take value away from Earn Users and funnel it to other creditor groups.”
Genesis and Gemini Surrounded by Trouble
“We allege that Genesis and Gemini offered unregistered securities to the public, bypassing disclosure requirements designed to protect investors.”
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