- Gemini Trust Company and its founders are being sued for not registering Gemini Earn as a security.
- Investors who lost funds allege they were not given enough data to make an informed decision.
- Gemini has not updated Earn clients since suspending withdrawals after Genesis’ liquidity difficulties.
According to Bloomberg, a class action lawsuit has been filed against Gemini Trust Co. and its founders, Tyler and Cameron Winklevoss, on allegations that the cryptocurrency exchange unlawfully issued interest-bearing accounts without registering them as securities.
Investors claim the firm and its founders of fraud and breaches of the Exchange Act in a class-action lawsuit filed on Tuesday in the U.S. District Court for the Southern District of New York.
Launched in 2015 by Cameron and Tyler Winklevoss, Gemini offers a high-yield product called Gemini Earn that enables consumers to deposit their cryptocurrencies for interest, similar to a bank account, delivering yields of up to 8% on their holdings, depending on the asset.
Gemini unexpectedly suspended withdrawals for Earn last month when Genesis Global—the exchange’s primary partner—faced a liquidity problem amid the contagion created by the bankruptcy of FTX, Alameda Research, and dozens of ...
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