Winklevoss Twins Ask US Court To Dismiss SEC Lawsuit Over Crypto Exchange
• The US Securities and Exchange Commission (SEC) sued Gemini and Genesis earlier this year over the Gemini Earn Program.
• Gemini and Genesis are now asking a US District Court to dismiss the case.
• There has been tension between Gemini’s Tyler and Cameron Winklevoss and Digital Currency Group’s CEO Barry Silbert over alleged fraud against Earn users.
SEC Lawsuit Against Gemini & Genesis
The US Securities and Exchange Commission (SEC) filed a lawsuit against cryptocurrency exchange Gemini and bankruptcy crypto lending platform Genesis earlier this year over their Gemini Earn Program. The two firms are now asking the United States District Court for the Southern District of New York to dismiss the case.
Gemini Earn Program
The Gemini Earn Program, which was launched in February 2021, allowed people to lend digital assets to Genesis. All parties involved were part of a “tri-party contract” called the Master Digital Asset Loan Agreement (MDALA). According to court documents filed by Gemini, they argued that MDALA was not a security but rather an asset lending program that did not require any lending or borrowing by any party.
Tension Between Companies
Due to market volatility, investors in the program were unable to withdraw their crypto from the program leading to public tension between Tyler and Cameron Winklevoss of Gemini and Barry Silbert of DCG’s parent company Digital Currency Group. Cameron Winklevoss accused DCG of defrauding more than 340,000 users by owing them $1.675 billion which Silbert denied.
Genesis & Geminis Response To SEC Lawsuit
In response to the SEC lawsuit, both firms are asking for it be dismissed due to lack of evidence that MDALA is a security as well as lack of sufficient liquid assets due to market volatility being out of their control.
It remains unclear whether or not these companies will be able to successfully get this case dismissed but it is clear that there is still tension between both parties stemming from fraudulent accusations against each other regarding money owed from the Earn program fiasco earlier this year.