Arbitrator Clears Gemini of Liability for Earn Collapse

Gemini launched Earn in 2021, allowing customers to lend digital assets through Genesis Global Capital for yields of as much as 7.4% a year. Genesis halted withdrawals and new loans on Nov. 16, 2022, as the crypto market reeled from FTX’s collapse, and filed for bankruptcy in January 2023. The failure froze assets belonging to more than 300,000 users and raised questions about Gemini’s risk disclosures and oversight of its lending partner.

An arbitrator on Aug. 12 rejected a claim filed by one Earn customer in late 2024, finding no evidence that Gemini Space Station misled users, breached its duties or failed to conduct adequate due diligence on Genesis. The decision attributed the program’s collapse to Genesis and its parent, Digital Currency Group. Earn users recovered more than $2.18 billion of digital assets in kind during May and June 2024, though separate arbitration claims over unpaid interest remain unresolved.