Gemini Returns Over $2 Billion to Users: Compensation History
Date: 2024-05-30 Author: Henry Casey Categories: BUSINESS
Compensation Announcement
Crypto exchange Gemini recently reported significant success: the company returned $2.18 billion to Earn participants, which is 97% of the frozen assets. This amount significantly exceeds the original liabilities, amounting to 232% of the original amount, thanks to the valuation of assets at the current market rate as of May 28, 2024.
Increase in Compensation
Initially, user assets at the time of freezing the withdrawal of funds were estimated at $940 million. However, taking into account the rise in cryptocurrency rates, the total amount of compensation increased by more than $1 billion. In total, 232,000 affected users received funds.
Company co-founder Cameron Winklevoss expressed satisfaction with the outcome: "We are very pleased that we were able to achieve this compensation for our clients. We recognize the difficulties caused by this lengthy process and appreciate our clients' continued support and patience throughout the process."
Remaining Funds
Gemini also noted that the remaining 3% of frozen assets will be returned to users over the next 12 months. Co-founder and CEO of the exchange Tyler Winklevoss emphasized that the bankruptcy of Genesis, which caused Gemini's problems, was the result of fraud.
Problems with Earn
The Earn program's history of problems began in November 2022, when crypto lender Genesis blocked withdrawals and soon filed for bankruptcy. This led to the freezing of $900 million in assets of participants in the Earn program, which Gemini launched in partnership with Genesis.
In response to the crisis, Gemini was forced to temporarily freeze withdrawals, which led to many requests from customers. In July 2023, the exchange filed a lawsuit against Genesis and its parent company, Digital Currency Group.
Financial Solution
In February 2024, after Genesis disposed of most of its assets, Gemini announced a full refund for Earn participants' losses. Tyler Winklevoss noted that this step was made possible thanks to the efforts of the team and the support of customers who helped overcome a difficult period.
Gemini's refund history shows the company's commitment to its customers and commitment to ensuring their financial security. Despite difficulties and legal battles, the exchange managed not only to return funds, but also significantly exceed its initial obligations, which was an important step in restoring user trust.
