cryptonews: A trio of Gemini Earn clients seeking to unlock their frozen assets have filed a class action arbitration request against crypto lender Genesis, alleging that it has 'concealed its insolvency' since this summer.🧐
The class action claims that Genesis Global Capital hid its own financial problems via a "sham transaction" in which it sold parent company Digital Currency Group the effectively uncollectable 3AC debt for a
due in a decade. That breached its agreement with Gemini Earn clients, the action states, and requires the return of their funds. The arbitration request comes a day after the Gemini exchange's president and co-founder, Cameron Winklevoss, releasedaccusing DCG president Barry Silbert of "bad faith stall tactics" in failing to return $900 million owed to 340,000 Gemini Earn clients. In it, he strongly implied that Gemini would sue Genesis and DCG if talks about a plan to repay customers didn't begin by Jan. 8.
While Genesis' losses came primarily from 3AC's bankruptcy, the liquidity crunch that caused it to halt withdrawals came to a head after the failure of Sam Bankman-Fried's FTX exchange created an industry-wide upheaval.Beyond the breach-of-contract allegations, the class action arbitration filing accuses Genesis of illegally selling unregistered securities in the form of the interest-bearing Gemini Earn accounts. On Dec.
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