New York Attorney General Letitia James has announced a historic $2 billion settlement with bankrupt cryptocurrency lender Genesis. This settlement aims to repay defrauded investors and marks the largest settlement against a crypto firm in New York’s history. The agreement comes after Genesis filed for Chapter 11 bankruptcy protection in January 2023, following the collapse of FTX and other major crypto companies.


Genesis, once a key player in the Digital Currency Group (DCG), faced significant financial turmoil due to the industry contagion triggered by the FTX collapse. The company halted withdrawals in November 2022, leaving many investors in limbo. In October 2023, Attorney General James sued DCG, Genesis, and Gemini Trust, alleging that they misled investors about the Gemini Earn program, resulting in over $1 billion in losses. The lawsuit was later expanded to claim that DCG and Genesis defrauded additional investors out of more than $2 billion.

Settlement Details

  • Amount: $2 billion
  • Beneficiaries: Hundreds of thousands of investors across the U.S., including at least 29,000 New Yorkers
  • Fund: A victims’ fund will be established to compensate investors and creditors
  • Operational Ban: Genesis is barred from operating in New York
  • Admission of Guilt: Genesis neither admits nor denies the allegations

Legal Proceedings

A bankruptcy court approved Genesis’s Chapter 11 repayment plan, which includes the $2 billion settlement with the New York Attorney General’s office. The court also dismissed a legal challenge from DCG, paving the way for the settlement. The Securities and Exchange Commission (SEC) has also filed a suit against Genesis and Gemini over the unregistered offering and sale of securities. A separate settlement has been approved to end this complaint.

Impact on Investors

The settlement will establish a fund to repay investors who had their tokens frozen on the platform since November 2022. The fund will receive assets remaining in Genesis’s estate after initial bankruptcy distributions to creditors. If these creditors are not made whole based on current digital asset values, the fund will receive up to $2 billion from Genesis’s remaining assets.

Gemini Earn Program

Gemini, one of Genesis’s creditors, announced that it would begin returning the first 97% of owed assets in-kind to customers of its defunct Gemini Earn program by the end of the month. This means that customers will receive the same type of cryptocurrency they initially deposited, rather than its U.S. dollar value at a specific date.


This $2 billion settlement is a significant step towards providing justice to the victims of Genesis’s alleged fraud. It also highlights the need for increased oversight and regulation within the cryptocurrency industry to prevent such detrimental losses in the future.


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