SEC charges Genesis, Gemini for failing to register crypto lending product

The Securities and Exchange Commission (SEC) accused two cryptocurrency firms, Genesis Global Capital and Gemini Trust Company, with selling a crypto lending product to investors as an unregistered security.

The SEC said Genesis and Gemini raised “billions of dollars’ worth of crypto assets from hundreds of thousands of investors” with an investment vehicle called Gemini Earn. The program constituted the offering and sale of a security but was not registered with the SEC, a violation of federal securities law.

In its complaint filed in U.S. District Court for the Southern District of New York, the SEC seeks permanent injunctive relief, disgorgement of ill-gotten gains plus prejudgment interest, and civil penalties.