– A class-action lawsuit has been filed against Gemini and its founders Tyler and Cameron Winklevoss, accusing them of fraud and other crimes.
– The lawsuit claims that Gemini offered unregistered securities in the form of interest-bearing accounts, violating the Exchange Act.
– The lawsuit also alleges that Gemini refused to honor any further investor redemptions, wiping out all investors who still had assets in the program.
Investors have filed a lawsuit against Gemini, the U.S. cryptocurrency exchange, and its founders Tyler and Cameron Winklevoss, claiming that the company and its founders are guilty of fraud and other crimes. According to the class-action lawsuit filed in Manhattan federal court on Tuesday, the exchange offered unregistered securities in the form of interest-bearing accounts.
The lawsuit alleges that Gemini violated the Exchange Act by offering these unregistered securities. The plaintiffs of the lawsuit state that Gemini failed to register the securities with the Securities and Exchange Commission, as required by law. The lawsuit further claims that Gemini refused to honor any further investor redemptions, thereby “wiping out” all investors who still had assets in the program.
The legal action follows news that Genesis Global Capital, a cryptocurrency lending firm, experienced a liquidity crisis last month due to the bankruptcy filing of FTX. As a result, Gemini immediately halted withdrawals for the interest-bearing contract. According to estimates, Genesis had $175 million invested in FTX prior to the bankruptcy filing.
The lawsuit seeks financial damages for the investors that have been affected by Gemini’s alleged violations. The plaintiffs claim that they have been wrongfully deprived of the money they invested in Gemini and that they should be compensated accordingly.
The Winklevoss twins have yet to respond to the lawsuit. The outcome of this case could have a significant impact on the future of cryptocurrency exchanges and their founders. If the Winklevoss twins are found guilty of the charges, it could set a precedent for future cases involving similar allegations. Furthermore, if the lawsuit is successful, it could lead to stricter regulations for cryptocurrency exchanges in the future.