Gemini Earn, a lending program offered to customers of crypto exchange Gemini, has paid out creditors $2.18 billion of their digital assets in kind.
In a blog post on Wednesday, Gemini co-founders Cameron and Tyler Winklevoss said these initial creditor distributions represent 97% of total assets in the Earn program, which is $1 billion more than the value of their assets at the time Genesis halted withdrawals and represents a 232% recovery.
The Winklevoss brothers expect the remaining asset balance to be paid out within the next year.
“This means, for example, that if you had lent one bitcoin in the Earn program, you will receive one bitcoin back. And it means that you will receive any and all appreciation of your assets since you lent them into the Earn program,” said the twins in the blog post.
Gemini Earn was launched in 2021 and offered users the opportunity to earn up to 7.4% APY on their crypto, through counterparty loans to the now-bankrupt Genesis Global Capital. When Genesis became caught up in the aftermath of FTX’s bankruptcy, the firm abruptly halted withdrawals, leaving Earn customers’ assets stranded.
After much legal drama, including a lawsuit filed by Gemini against Genesis, one from the New York Attorney General and back and forth negotiations with a committee of creditors, the entities finalized a reorganization plan to pay back creditors. Gemini also contributed $50 million to the recovery plan proposed for Earn users.
“We are thrilled that we have been able to achieve this recovery for you,” said the Winklevoss brothers, adding that “it’s important to note that the Genesis bankruptcy was not a crypto problem. It was old-fashioned financial fraud compounded by a lack of regulatory clarity.”
