In addition to the Ethereum ETF, last night's $2 billion event is also worth paying attention to
Original title: Genesis Reaches $2 Billion Settlement With New York AG's Office
Original source: Bitcoinist
Original translation: Blockchain Knight
The New York Attorney General's Office has reached a $2 billion settlement with the bankrupt Crypto asset lending platform Genesis Global Capital.
The settlement, approved by a federal bankruptcy judge, will establish a victims fund to compensate thousands of New Yorkers and other investors who lost money through the Genesis platform.
New York Attorney General Letitia James announced the agreement on Monday, calling it the largest settlement ever reached in the state against a Crypto asset company.
The settlement resolves some allegations that Genesis and its affiliates concealed $1.1 billion in losses from project investors in "Gemini Earn."
“When investors suffer losses due to fraud and manipulation, they deserve to be compensated,” said Attorney General James. “This historic settlement is an important step in ensuring justice for the victims who invested in Genesis.”
The settlement follows a lawsuit filed by the Attorney General’s Office in October 2023 alleging that Genesis and other defendants defrauded hundreds of thousands of investors nationwide.
The lawsuit was later expanded in February to target Genesis’ parent company DCG, DCG CEO Barry Silbert, and former Genesis CEO Soichiro Moro.
Under the terms of the agreement, the crypto asset lending company will not admit any wrongdoing. Nonetheless, litigation will continue against the remaining defendants and Genesis’ former business partner, Gemini Trust Company.
The $2 billion settlement will establish a “Victims Fund” to distribute payments to the company’s creditors, which include at least 29,000 victims who contributed more than $1.1 billion to the company’s “Gemini” program.
The settlement requires Genesis to contribute an additional $2 billion to the fund if the remaining assets in the Genesis bankruptcy estate are insufficient to fully compensate these creditors.
Genesis’s collapse is closely tied to the high-profile collapse of crypto asset exchange FTX and its sister trading firm Alameda Research in late 2022.
Prior to its bankruptcy, the company reportedly lent millions of dollars in unsecured loans to Alameda and $2.4 billion to the now-defunct crypto asset hedge fund Three Arrows Capital.
Friday’s bankruptcy court ruling approving Genesis’ repayment plan also represents an important step toward recovering funds for victims of the crypto asset industry.
Attorney General James has pledged to continue his office’s work to increase oversight and regulation of the crypto asset space, and has secured more than $2.5 billion in settlements from other predatory platforms.
“Once again, we see that a lack of oversight and regulation in the crypto asset industry can lead to real-world consequences and harmful losses,” James concluded.
“Investors in New York deserve the assurance of a properly regulated market, which is something my office will always work to achieve.”
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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