Gemini Earn Returns Over $2 Billion in Cryptocurrency to Users

By: Eliza Bennet

Crypto exchange Gemini announced that users of its now-defunct Earn product have received $2.18 billion in digital assets, according to a statement released on May 29. This milestone represents 97% of the total digital assets owed to Earn users, marking substantial recovery since the collapse of the crypto lender Genesis, which had halted withdrawals in November 2022.

The assets were returned in kind, meaning that if a user had lent one Bitcoin (BTC) to the Earn program, they received one BTC back. This implies a 232% recovery for Earn users, given the significant increase in the value of various digital assets over the past two years. Cameron and Tyler Winklevoss, Gemini's founders, emphasized the unprecedented nature of this recovery, highlighting that it represents a significant achievement among both crypto and traditional bankruptcies. The recovery follows a settlement reached with Genesis and other creditors, ensuring that all Earn users will receive 100% of their digital assets back in kind.

However, Gemini stressed that Genesis's bankruptcy was not a byproduct of crypto market dynamics but was caused by traditional financial fraud exacerbated by a lack of regulatory clarity in the U.S. The company has reaffirmed its commitment to advocating for clearer regulatory measures that balance innovation with consumer protection. They further stated, "We will continue to fight for clear rules and guidance for our industry that foster both innovation and consumer protection. The future is bright."

Despite the optimistic recovery, industry analysts caution that these in-kind distributions could result in selling pressure as creditors may opt to liquidate their assets. Evan Cohen, a thesis investor, noted on social media that many sellers are now ready to offload their crypto, which has been locked for two years. Increased trading activity could potentially impact the prices of major cryptocurrencies such as Bitcoin and Ethereum (ETH). Current data shows a slight 0.73% decline in the broader market over the past 24 hours, with BTC and ETH prices now standing at $67,640 and $3,761, respectively.