Gemini Trust Company, the cryptocurrency exchange founded by Cameron and Tyler Winklevoss, has reached a settlement in principle with the U.S. Securities and Exchange Commission (SEC) regarding allegations related to its Gemini Earn lending program. The settlement was announced on Monday in a filing submitted to Judge Edgardo Ramos in Manhattan federal court.
The SEC originally charged Gemini and Genesis Global Capital in January 2023 for the unregistered offer and sale of securities to retail investors through the Gemini Earn program. Launched in 2021, the program allowed customers to lend cryptocurrencies including Bitcoin (BTC) to Genesis in exchange for yields of up to 7.4% APY. The lawsuit claimed both companies bypassed necessary disclosure requirements designed to protect investors.
Genesis eventually filed for bankruptcy, leaving customers locked out of funds and intensifying regulatory scrutiny. While Genesis accepted a $21 million fine from the SEC to settle its legal issues without admitting wrongdoing, Gemini has consistently denied any misconduct related to its Earn program.
The settlement comes just four days after Gemini successfully raised $425 million in its initial public offering, valuing the company at approximately $3.3 billion. Following the settlement announcement, shares of Gemini, trading on Nasdaq under the ticker GEMI, closed Monday's trading session at $32.52, a 16% increase from the $28 IPO price.
The resolution follows a broader shift in the SEC's posture under new leadership. Since President Donald Trump appointed crypto-friendly regulator Paul Atkins to lead the Commission in January, the agency has launched Project Crypto to modernize rules for digital assets and dropped lawsuits against firms including Coinbase, Binance, and Ripple.