• Genesis settles $21M SEC penalty, permanent injunction for Gemini Earn violations.
• SEC Chair Gensler emphasizes crypto compliance with securities laws.
• Genesis authorized to sell $1.6B GBTC assets.

Genesis Global Capital has agreed to pay a $21 million penalty and accept a permanent injunction for selling unregistered securities, according to an official press release by the U.S. Securities and Exchange Commission (SEC). The agreement, finalized by a New York federal judge, marks a significant step in resolving the lawsuit against Genesis and Genesis Trust Co.

The settlement underscores Genesis’s failure to register its retail crypto lending product, bypassing critical disclosure requirements intended to protect investors.

SEC Chair Gary Gensler has emphasized the importance of compliance with securities laws in the crypto lending space.

Impact on the crypto market

Following the collapse of FTX, Genesis faced challenges, including the suspension of repayments, withdrawals, and new loan originations.

Withdrawal issues also affected Gopax’s GoFi earn product, linked to Genesis, reflecting the broader impact of Genesis and Gemini Earn on global cryptocurrency markets.

The repercussions of Genesis and Gemini Earn reverberated throughout the cryptocurrency market.

Gemini, a New York-based cryptocurrency exchange, agreed to return $1.1 billion in digital assets to users of its Earn program in light of Genesis’s bankruptcy.

Meanwhile, Genesis received authorization from the U.S. Bankruptcy Court in the Southern District of New York to sell off $1.6 billion worth of GBTC to repay creditors, signalling progress in the resolution process.

This resolution highlights the need for transparency and adherence to securities laws, particularly in emerging sectors like crypto lending.

The post Genesis agrees to $21M SEC settlement over Gemini Earn appeared first on CoinJournal.