- The dismissal follows confirmation that Earn customers have received 100% of their crypto assets back.
- Gemini separately reached a settlement with New York state regulators concerning its involvement in the Earn program.
A major chapter in the post‑FTX crypto enforcement wave appears to be closing, as U.S. regulators move to end their lawsuit against Gemini over its defunct Earn product.
The U.S. Securities and Exchange Commission (SEC) filed a joint stipulation with Gemini on Friday, asking a federal judge to dismiss the case, after confirming that Earn customers have now received 100% of their crypto assets back through the Genesis Global Capital bankruptcy process.
Gemini’s Earn program lets users deposit crypto and earn yield by lending those assets to Genesis Global Capital, a large institutional lender.
The structure worked while the broader market remained stable, but it unraveled after the 2022 collapse of FTX and the wider downturn in digital assets. Genesis froze withdrawals, leaving Earn customers unable to access their funds and exposing the risk of relying on a single, opaque counterparty.
In 2023, the SEC sued both Gemini and Genesis, alleging that the Earn product amounted to an unregistered securities offering.
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Genesis And New York Settlements Remain
The legal landscape shifted as Genesis moved through bankruptcy and negotiated settlements. According to the joint filing, Gemini Earn customers have now recovered 100% of their crypto in kind through the Genesis bankruptcy and related resolutions.
While the federal case against Gemini appears headed for closure, other enforcement actions around Earn remain in place. Genesis previously settled with the SEC and agreed to pay a 21 million dollar civil penalty, acknowledging conduct the agency viewed as unlawful. That settlement came as part of Genesis’s broader restructuring and reflects the regulator’s intent to punish behavior it sees as noncompliant, even when customers ultimately get their assets back.
Gemini also reached a separate settlement with New York state regulators over its role in the Earn program.
Over the past year, the agency has dropped more than a dozen crypto‑related lawsuits, most of which were filed during the administration of former President Joe Biden and under former SEC Chair Gary Gensler.
Current SEC Chair Paul Atkins signaled a shift in November, saying the regulator would publish new guidelines to help crypto companies determine whether their products qualify as securities.
