- Gemini Earn, a popular profit-yielding product, went bust in 2022 following the FTX contagion and consequent crypto market crash.
- Earlier this week Gemini Earn repaid 97% of customer’s lost funds thanks to settling bankruptcy proceedings with parent company Genesis.
- Customers will be repaid in kind – meaning if they owned 1 BTC in November 2022, they will be receiving 1 BTC today despite the massive increase in price.
- This decision has seen customers repaid 232% more than the fiat value of assets lost in 2022.
Let’s be honest – unless you’re an avid rowing fan, or a friend of Mark Zuckerberg, it’s likely your first exposure to the Winklevoss twins came from the 2010 film The Social Network.
Since then, the two brothers have become part of the crypto zeitgeist as early Bitcoin adopters and founders of the Gemini Earn program. Unfortunately, the duo (and their customers) were victims of the 2022 FTX contagion after their parent company, Genesis, filed for Chapter 11 bankruptcy.
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However, after a bitter legal dispute, fortunes for Gemini Earn users appear to be changing, with 97% of all lost assets returned earlier this morning.
Customers to be Compensated “In Kind”
In a blog post on the Gemini website, the Winklevoss twins addressed customers that had been affected by the 2022 liquidation. They labelled it an unprecedented recovery among crypto bankruptcies – which, salesly language aside, rings true for a couple of key reasons.
US$2.18b (AU$3.3b) worth of digital assets were returned to customers who lost funds due to Genesis and Gemini Earn’s demise a few years ago. This represents 97% of all crypto lost – and the remaining 3% is set to be distributed to Gemini Earn wallets over the next 12 months.
But what makes this bankruptcy proceeding stand out is that payments are being made in kind. Why is this a big deal?
Well, in 2022 at the time of the collapse, crypto was at its lowest point in years. Most similar repayment plans (I’m looking at you FTX) compensated losses based on monetary value at that point.
Bitcoin was worth under US$20k (AU$30.25k) in November 2022. Today, it is trading well above US$65k (AU$98.3k) – so victims of FTX are getting about 66% less than they would’ve if repayments were made in crypto.
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This is where Gemini Earn is bucking the trend. Thanks to the stunning market recovery in 2024, customers are receiving approximately US$1b (AU$1.5b) more than when Genesis halted withdrawals in 2022. This represents an increase of approximately 232% – all because Genesis is compensating victims in kind.
Hopefully, this becomes the standard for all crypto repayment plans when the unthinkable happens. Despite some mistakes made along the way, Gemini’s move today has helped restore some faith in the Winklevoss twins and the industry at large.
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