SEC Alleges Gemini, Genesis Sold Unregistered Securities

Technology /

The U.S. Securities and Exchange Commission (SEC) alleged crypto exchange Gemini and crypto lender Genesis Global Capital sold unregistered securities in a lawsuit filed late Thursday. CoinDesk reports: The investment regulator took aim at Gemini Earn, the troubled yield-bearing product that hundreds of thousands of U.S. investors entrusted with their crypto. Gemini generated yield on billions of dollars in crypto by loaning deposits to Genesis, which loaned them out again. But Genesis’ November closing of lending withdrawals left some 340,000 Gemini Earn customers and about $900 million in crypto in limbo, the SEC said. The regulator accused the popular program of being an unregistered security. “Defendants offered and sold the Gemini Earn Agreements through the Gemini Earn Program without registering” with securities regulators, the complaint said. “As a result, investors lacked material information about the Gemini Earn program that would have been relevant to their investment decisions.”

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