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.

Genesis is a subsidiary of Digital Currency Group; Gemini is owned by billionaire twins Cameron and Tyler Winklevoss.

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.

According to the SEC’s complaint, Genesis and Gemini agreed in December 2020 to create the Gemini Earn program that would allow Gemini investors to loan their cryptocurrencies to Genesis, an arrangement for which Genesis would pay interest to investors and Gemini would collect agent fees as high as 4.29 percent. Under the arrangement, Gemini Earn funds were to be held by Genesis, and Genesis would be responsible for generating the revenue necessary to pay interest on the loans, the SEC said.

Following the collapse and bankruptcy of crypto trading platform FTX in November, Genesis announced it would not allow Gemini Earn investors to withdraw their crypto assets, due to a lack of liquidity caused by the volatility of the crypto asset market. At the time, 340,000 Gemini Earn investors held $900 million worth of crypto assets. Genesis terminated the Gemini Earn program earlier this month, the SEC said, and Gemini Earn investors still have not been allowed to withdraw their funds.

“We allege that Genesis and Gemini offered unregistered securities to the public, bypassing disclosure requirements designed to protect investors,” SEC Chair Gary Gensler said Thursday in a press release. “Today’s charges build on previous actions to make clear to the marketplace and the investing public that crypto lending platforms and other intermediaries need to comply with our time-tested securities laws. Doing so best protects investors. It promotes trust in markets. It’s not optional. It’s the law.”

The SEC has placed crypto lending products in its regulatory sights, having fined BlockFi $50 million in February for failing to register its crypto lending product, BlockFi Interest Accounts, as a security. In September 2021, the regulator used a Wells Notice to threaten legal action against Coinbase, a crypto asset trading firm, when Coinbase asked for permission to launch a crypto lending product called Lend. Coinbase eventually abandoned the attempt while also complaining its competitors were offering similar products.

The enforcement actions make it clear the SEC considers crypto lending products to be securities but does not settle the larger regulatory question: Are cryptocurrencies securities or currencies? Some have argued no matter what the answer ultimately is—the SEC and Gensler claim most crypto assets are securities—the industry requires tighter regulation.

Gemini has been providing Gemini Earn users with regular updates about its dispute with Genesis on an update blog. Tyler Winklevoss, in a series of tweets Thursday, called the SEC’s action “disappointing.”

“This action does nothing to further our efforts and help Earn users get their assets back. Their behavior is totally counterproductive,” he said.

Genesis did not respond to a request for comment.