Gemini Earn Customers Are Getting All of Their Crypto Back—And It's Worth a Lot More Now

By André Beganski

The New York-based crypto platform Gemini announced Wednesday that users of its Earn program are receiving $2.18 billion worth of digital assets through an in-kind distribution.

“This represents an unprecedented recovery among crypto bankruptcies,” the company said in a press release, touting that Earn users are receiving 100% of their digital assets back—but the value of many of those assets has increased substantially since late 2022.

When approximately 232,000 Earn users lost access to their funds in 2022, their collective crypto assets were valued at around $940 million. If a user lent out one Bitcoin through the Earn program, for example, said user is receiving one Bitcoin back. And Bitcoin is worth nearly four times as much today as it was in November 2022, while other cryptocurrencies have seen varying value shifts.

Founded in 2014 by Cameron and Tyler Winklevoss, Gemini was engaged in an acrimonious dispute over Earn funds with Genesis, the defunct crypto lending company that halted customer withdrawals in 2022 amid plunging crypto prices and is owned by Digital Currency Group.

Representing a 232% increase in U.S. dollar value from when Genesis paused withdrawals, the payout for Gemini Earn users contrasts with the resolutions of some crypto bankruptcies.

For example, the bankrupt crypto exchange FTX anticipates returning 100% of customers’ funds when measured in U.S. dollars—yet that figure is reflective of depressed crypto prices when the firm filed for bankruptcy.

In February, Gemini said it would return $1.1 billion in digital assets to Earn users. At the same time, the company agreed to pay a $37 million fine to the New York Department of Financial Services over unsafe and unsound practices.

As part of the settlement, Gemini said it would contribute $40 million toward the recovery of user funds as well. On Wednesday, updating that figure to $50 million, the company said its in-kind distribution reflects 97% of the digital assets it owed to Earn users.

The remaining balance should be received by customers over the next year, Gemini said. 

In March, the bankrupt crypto lender Genesis paid $21 million to settle charges brought by the U.S. Securities and Exchange Commission (SEC). The SEC had accused Genesis of engaging in the sale of unregistered securities through Gemini Earn’s crypto lending program.

Last October, Gemini sued Genesis for control over $1.6 billion worth of shares in Grayscale’s Bitcoin Trust (GBTC), arguing that the funds had been pledged to them. Despite Genesis’ failure to deliver half of the shares as part of a security agreement, Gemid said it had used some of that capital to ultimately satisfy Earn users’ claims.

"We recognize the hardship caused by this lengthy process," Gemini co-founder and President Cameron Winklevoss said in a statement, adding the company is “thrilled that [it has] been able to achieve this recovery for customers.”

Edited by Andrew Hayward

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