Gemini Earn users are facing the harsh reality of potentially recovering only a fraction of their invested crypto value. The platform, which declared bankruptcy on January 19, 2023, has proposed a restructuring plan that might return as little as 61% of the crypto funds to its users. This plan includes possible reimbursements from Genesis and subsequent distributions, contingent on user approval.
The crisis unfolded as the US Securities and Exchange Commission (SEC) charged Gemini with unregistered offerings and sales of securities through its Earn program. Gemini Earn, launched in February 2021, was designed to allow retail investors to earn interest on their crypto assets. However, there were allegations that Gemini misled customers about the Federal Deposit Insurance Corporation (FDIC) status of their Gemini Dollar (GUSD) stablecoin deposits.
On December 13, Gemini filed a plan of reorganization in bankruptcy court, outlining an initial proposal for distributions to Earn users. This plan estimates that users could recover between 61-100% of their account balance from Genesis, plus potential additional funds from Gemini's litigation efforts. However, the plan's acceptance is subject to a vote by January 10, 2024. If rejected, it could lead to further delays in fund distribution.
Gemini and Genesis have also reached a $100 million agreement over the Earn program. The response from Gemini Earn users to this plan has been largely negative, with many expressing frustration and calling for a full reimbursement of their assets.
Disclaimer: Please note that the information provided in this article is based on the referenced research articles. It is essential to conduct further research and analysis before making any investment decisions. The cryptocurrency market is highly volatile, and investors should exercise caution and consult with financial professionals before engaging in cryptocurrency trading or investment activities.
