SEC Files Suit Against Gemini and Genesis Over Crypto “Earn” Program

Posted on January 27th, 2023 at 1:46 PM
SEC Files Suit Against Gemini and Genesis Over Crypto “Earn” Program

From the Desk of Jim Eccleston at Eccleston Law.

The Securities and Exchange Commission (SEC) has filed suit against two crypto brokerages, Genesis Global Capital and Gemini Trust Co., for breaching federal securities laws.

The SEC’s complaint alleges that the brokerages improperly raised billions of dollars through the Gemini Earn program. While the program enabled clients to loan out their assets in exchange for interest payments, the SEC determined that the program constituted an offering of unregistered securities. Gemini created Earn in February 2021, which would permit customers to earn passive returns on their coins in exchange for the right to lend the tokens out.

The program offered rates that far exceeded those offered by traditional banks, which led to the program’s surpassing $3 billion in assets by the end of 2021. Gemini’s co-founder, Tyler Winklevoss, responded to the SEC’s allegations on Twitter by calling the complaint a “manufactured parking ticket.” Winklevoss additionally noted that Gemini had been discussing Earn with the SEC for the past 17 months, and that the SEC filed an enforcement action only when Genesis paused withdrawals from the program. Those will not be defenses, but make for an interesting showdown.

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

Tags: eccleston, eccleston law, advisors, law, sec

Return to Archive

TESTIMONIALS

Previous
Next

I am so blessed to have you and your dynamic team defending me. Your ethics, forward thinking and strategies are amazing.  You guys are the best group of attorneys in the country that I could hire to handle this complicated case.

Cindy C.

LATEST NEWS AND ARTICLES

March 4, 2026
Modern Fraud Schemes Escalate in Scale and Sophistication

A recent panel discussion at the Financial Services Institute OneVoice conference in San Diego highlighted how rapidly evolving fraud schemes continue to victimize both retail and wealthy investors.

March 3, 2026
FINRA Suspends Former Stifel Broker Over Costly Account Switching Trades

The Financial Industry Regulatory Authority (FINRA) suspended a former Stifel, Nicolaus & Co.

March 2, 2026
FINRA Suspends Cetera Broker for Accepting $50,000 Client Bequest Without Firm Approval

The Financial Industry Regulatory Authority (FINRA) imposed a $10,000 fine and a seven-month suspension on an independent broker for accepting a $50,000 bequest from a client without obtaining prior firm approval.