Frozen for 18 Months! Gemini Financial Products to Return $2.18 Billion to Users, with a Total Profit of 232% – What About Taiwan?
Gemini’s financial product, Gemini Earn, suffered losses due to the bankruptcy of its partner Genesis, which was affected by FTX. As a result, Gemini Earn has suspended withdrawals.
Gemini and DCG were sued by New York law enforcement agencies for allegedly defrauding users of $1.1 billion by not disclosing financial risks.
After suspending withdrawals 18 months ago, this cryptocurrency exchange owned by billionaire twins, the Winklevoss brothers, fulfilled its commitment to users.
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Returning $2.2 billion to Earn users
Full refund with interest by Gemini
Centralized platform with traceable results: 232% refund
What is the Gemini Earn program? Why the losses?
What about Taiwan? Steaker not sued, compensation to the second stage
Repayment of 19% of user cases
Steaker not sued, founder expected to apply for state compensation
Gemini announced on Wednesday that it will refund $2.18 billion in digital assets to users of the Earn program. Withdrawals were suspended in November 2022 due to complications with its lending partner, Genesis Global Capital.
In the email, Gemini stated that as of the suspension date (November 16, 2022), about 97% of the digital assets owed by Genesis can be used in Gemini accounts. Gemini assured users that they will recover all digital assets proportionally.
The $2.18 billion payout represents a 232% return on user assets since Gemini froze withdrawals from its Earn program 18 months ago, according to CNBC. It is a positive turn for users facing locked funds and uncertainty.
Similar to creditors or financial products in Taiwan, it allows users to deposit cryptocurrencies to earn interest.
The Earn program was launched in 2021, allowing customers to earn high returns by depositing cryptocurrencies into Gemini’s program. Gemini then lent these cryptocurrencies to institutional borrowers through Genesis Global Capital.
However, in November 2022, Genesis Global Capital suspended interest payments and redemptions, leading to Gemini suspending withdrawals from the Earn program. Subsequently, Genesis filed for Chapter 11 bankruptcy protection in January.
Last week, the New York Attorney General announced a $2 billion settlement with Genesis to compensate defrauded investors, allowing Gemini Earn to come to a close.
Steaker, a Taiwanese digital asset management platform that was also affected by FTX and unable to make withdrawals, is currently in the second phase of its compensation plan (April 2024) and has issued 219,100 USDC. Recently, FTX announced that it can receive 118% excess compensation, but there is currently no public information regarding Steaker’s corresponding response.
According to user cases investigated by Chain News, 19% of repayments have been made so far.
This type of financial product in Taiwan has faced discussions of “fundraising” concerns, and various exchanges have also suspended the public operation of debt products. The founder of Steaker was detained and banned from meeting at the time of the incident and was subsequently detained for 51 days. Eventually, he was released on bail of NT$3 million in February 2023.
This case has not been prosecuted so far, and according to Article 1 of the Criminal Compensation Act, “before a decision is made to prosecute or withdraw a prosecution due to insufficient suspicion of a crime or no punishment, detention, forensic detention, or custody has been imposed,” compensation can be applied for.
FTX currently claims to be able to fully compensate, depending on the proportion of non-stablecoins in the user assets operated by Steaker at that time. Besides the impact of low liquidation prices on stablecoin assets, stablecoin assets should also be returned with interest.
FTX
Gemini
Genesis
Steaker
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