Frankfurt A new setback for the crypto world: The US Securities and Exchange Commission filed a lawsuit against the crypto exchange Gemini and the crypto currency broker Genesis on Thursday evening. SEC boss Gary Gensler accuses the companies of violating American securities laws with their program called “Earn”.
Gemini users could lend certain tokens and keep interest on them. Gemini then passed these tokens on to Genesis. The once-respected cryptor broker then lent the tokens to hedge funds for risky speculative trades.
The SEC defines the program as a securities transaction that should have been registered with the regulator. However, according to the complaint, this was not the case.
The Earn program had to be discontinued at the end of last year as a result of the great price turbulence on the crypto markets. Genesis was no longer able to repay Gemini users’ money. In total, it should be about 900 million dollars.
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