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Nidhi Kolhapur
Nidhi Kolhapur
Author
Nidhi is a Certified Digital Marketing Executive and Passionate crypto Journalist covering the world of alternative currencies. She shares the latest and trending news on Cryptocurrency and Blockchain.
- Feb 02, 2024 04:54 UTC
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Genesis Global Settles $21 Million SEC Dispute Over Gemini Earn
Genesis Global, a subsidiary of Digital Currency Group, has agreed to pay a $21 million civil penalty to settle SEC charges.
The SEC accused Genesis of offering unregistered securities and took legal action.
Genesis will only pay the penalty if it successfully repays creditors and customers in its Chapter 11 bankruptcy proceedings.
In a significant development, Genesis Global, a subsidiary of Digital Currency Group, has agreed to a $21 million civil penalty to resolve a lawsuit filed by the U.S. Securities and Exchange Commission (SEC). This settlement comes as a response to the SEC’s accusations of securities rule violations related to the now-defunct Gemini Earn program.
The SEC previously charged Genesis with offering unregistered securities, specifically pointing to the operation of the Gemini Earn program in collaboration with Gemini Trust. These allegations led to the SEC taking legal action against Genesis Global.
The $21 Million Agreement
Genesis has agreed to pay a $21 million civil penalty to put an end to the legal dispute. However, there’s a crucial condition attached – full repayment to customers and creditors as part of the ongoing Chapter 11 proceedings.
The SEC’s lawsuit, filed last year, marked a turning point for Genesis, prompting the company to address the allegations amidst its Chapter 11 proceedings initiated in January 2023.
Read More: Genesis Settles $620M Lawsuit with DCG, But the Conflict Isn’t Over Yet
It’s Not Been an Easy Journey!
Currently navigating Chapter 11 proceedings, Genesis seeks approval from the bankruptcy court for the settlement. The decision to resolve the SEC lawsuit strategically positions Genesis to manage legal challenges efficiently and streamline its path through Chapter 11.
The SEC’s regulatory actions extended beyond Genesis, also targeting Gemini Trust for alleged securities rule violations. The settlement terms emphasize that Genesis will only pay the $21 million penalty if it successfully fulfills its commitment to repay creditors and customers in the Chapter 11 bankruptcy proceedings.
A Strategic Resolution
This settlement not only addresses financial aspects but also strategically positions Genesis to prioritize the return of maximum cash to creditors. By saving cash and focusing on Chapter 11 proceedings, the company aims to navigate the legal challenges efficiently and ensure distressed customers recover their funds after a year of uncertainty.
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