Gemini has fired back at the U.S. Securities and Exchange Commission (SEC) in an electrifying legal tussle. The prestigious crypto exchange along with its embattled ally, the now-bankrupt lender Genesis, has set the stage for an exhilarating legal battle as it seeks to dismiss the SEC’s lawsuit lodged against its pioneering Earn Product.
“No more,” Gemini proclaimed, slamming the SEC’s allegations as “ill-conceived” and standing firm in its conviction that its innovative Earn product, which promises yields to its customers’ crypto deposits, is no security.
The Truth Behind the Gemini Earn Product: It’s Loans, Not Securities!
In an audacious move, Genesis chimed in, supporting its compatriot and shedding light on the true nature of these transactions. They are not securities, they are loans! The power duo pleaded with the court to scrap the complaint or, if that fails, at least to obliterate the SEC’s brazen requests for a permanent injunction and disgorgement.
To add fuel to the fire, the SEC’s complaint accused Gemini of operating the customer-centric arm of the Earn program, and not Genesis. Gemini fired back, claiming that it only acted as a transfer agent for the Earn product, while once again dubbing the SEC’s lawsuit as “ill-conceived”.
So, here’s some backstory: Genesis went bankrupt after another crypto exchange, FTX, collapsed. This left the users of the Earn program in a fix since they haven’t been able to take out their money since November 2022.
Gemini’s Got Your Back, Earn Users!
Now, Gemini’s stepping up and going after Genesis’ parent company, Digital Currency Group (DCG). They’ve filed a big claim to get back a whopping $1.1 billion for 232,000 Earn users. The tension is high, and Gemini and DCG are negotiating to settle things down. But things are rocky because DCG missed a huge $630 million loan payment to Genesis. Gemini’s warning everyone that DCG might not be able to pay its debts.
Gemini is represented by JFB Legal Firm
Gemini is now being defended by JFBLegal in court. Their lawyer, Jack Baughman, is questioning the SEC’s lawsuit over Gemini’s Earn product. He said Gemini Earn Product wasn’t a security and there was no sale. He also pointed out that the SEC’s lawsuit is making it more difficult to solve the problems from Genesis’ bankruptcy and isn’t helping users get their money back. Gemini and their lawyers are ready to fight this lawsuit.
“Whatever the Earn contract might be, it was never sold. Who was the seller? Who was the buyer? How much did it cost? Could it be resold? Everyone knows what a sale is. It’s obvious there was not one here.” Jack Baughman.
— Jack Baughman (@JackBaughman27) May 26, 2023
Gemini Eyes UK Amid Regulatory Uncertainty
Amidst the growing uncertainty in their home country’s regulatory environment, Gemini is considering setting up operations in the United Kingdom. This bold move comes as Gemini doubles down on its defense against the SEC’s lawsuit. Only time will tell how this riveting legal drama will unfold!