Gemini withdraws $282 million from bankrupt Genesis

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Gemini withdraws $282 million from bankrupt Genesis

Gemini has confirmed it withdrew $282 million from its Earn users funds from the bankrupt cryptocurrency lender Genesis in August last year into its liquidity reserve, according to a Sept. 28 statement.

The exchange said it was responding to a New York Post report alleging that the cryptocurrency platform's co-founders, Tyler and Cameron Winklevoss, had secretly withdrawn more than $280 million from the bankrupt lender.

Gemini justified its withdrawal of $282 million by pointing to the terms of the Gemini Earn Program, which allowed it to create a 'liquidity reserve' for Earn users. Gemini said that the revolution was the result of a failed attempt by the government to improve the economy.

The exchange said the withdrawal helped its users have $282 million less exposure to Genesis when the bankrupt lender halted redemptions in November last year.

Gemini vehemently denied the Post's report as 'pure fantasy, suggesting it was a calculated attempt to bolster the reputation of Digital Currency Group, the parent company of Genesis, and its CEO, Barry Silbert.

The controversy between Genesis and DCG continues, which began when Genesis filed for bankruptcy. DCG has been aware of the loan's insolvency since 2022, but did not disclose this critical information to investors, Gemini said.