A $21 Million Fine for Genesis:
- Genesis agrees to pay $21 million to the SEC to settle the lawsuit.
- The settlement follows a civil action related to unregistered offerings and sales of securities through Gemini’s crypto lending program.
- Genesis filed for bankruptcy in January 2022 following the collapses of Three Arrows Capital and crypto exchange FTX.
The End of a Lawsuit for Genesis?
The company Genesis has recently reached an agreement to settle a lawsuit filed by the Securities and Exchange Commission (SEC) a year ago, concerning a lending program. As a subsidiary of Digital Currency Group, Genesis has agreed to pay $21 million to the SEC, according to a document filed with the New York bankruptcy court.
Note that the payment will take place after the full settlement of all other “allowed administrative claims“, in accordance with the procedures established by the bankruptcy court.
This settlement will notably resolve the civil action complaint filed by the SEC in the Chapter 11 bankruptcy proceedings. Additionally, this arrangement seeks to eliminate the risks, costs, and uncertainties associated with prolonged litigation with the SEC.
“The proposed settlement will, among other benefits for the debtors’ successors, resolve the civil action filed by the SEC in connection with these Chapter 11 matters and eliminate the risks, expenses, and uncertainty associated with a protracted litigation against the SEC.”
said the SEC.
Looking Back at a Major Lawsuit in the Ecosystem
The $21 million payment to the SEC by Genesis concludes the civil action initiated a year ago against Genesis and Gemini.
This action was related to the offering and unregistered sale of securities to retail investors through Gemini’s crypto lending program.
The bankruptcy of Genesis Global Holdco, declared in January 2022, followed the collapses of Three Arrows Capital, one of the world’s largest investment funds, and crypto exchange FTX in 2022.
