Cryptocurrency exchange firm Gemini has announced the return of approximately $2.2 billion worth of digital assets to users affected by the collapse of its now-defunct Earn lending program. The move marks a major milestone in the recovery process for customers who had their funds frozen since late 2022, following the financial implosion of Genesis Global Capital—the lending partner behind the program.
Gemini confirmed in a recent post on X (formerly Twitter) that around 97% of the digital assets owed to users will now be accessible in their accounts. These initial distributions are being returned "in kind," meaning customers will receive the exact amount and type of cryptocurrency they originally deposited—plus any appreciation in value since the time of lending.
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What Is the Gemini Earn Program?
Launched in early 2021, the Gemini Earn program allowed users to lend their cryptocurrency holdings through an optional yield-generating service. In partnership with Genesis, a prominent crypto lending and trading firm, the program offered users up to 7.4% annual interest on assets such as Bitcoin (BTC), Ethereum (ETH), and select stablecoins.
The model was simple: users deposited crypto into the Earn program, Gemini facilitated the loan via Genesis, and in return, customers earned regular interest. At its peak, the program attracted billions in deposits from retail investors seeking higher returns than traditional financial instruments.
However, everything changed in November 2022.
Collapse of Genesis and Freeze on User Funds
In November 2022, Genesis halted withdrawals due to severe liquidity issues triggered by the broader crypto market downturn—one that followed the collapse of major platforms like Celsius and Three Arrows Capital. As a result, Gemini froze all withdrawals from the Earn program, leaving hundreds of thousands of users unable to access their funds.
By January 2023, Genesis filed for Chapter 11 bankruptcy, defaulting on approximately $1 billion in loans tied directly to Gemini Earn users. This triggered regulatory scrutiny and class-action lawsuits against both Gemini and Genesis.
Regulatory Fallout and Settlement
In February 2024, Gemini reached a settlement with the New York Department of Financial Services (NYDFS), agreeing to return at least $1.1 billion to impacted customers. The settlement came after NYDFS Superintendent Adrienne A. Harris criticized Gemini for failing to conduct proper due diligence on Genesis—an unregulated third party later accused of mismanagement and fraud.
“Gemini failed to conduct due diligence on an unregulated third party, later accused of massive fraud, harming Earn customers who were suddenly unable to access their assets after Genesis Global Capital experienced a financial meltdown,” Harris stated on February 28.
Despite the criticism, the current asset return initiative exceeds the settlement terms, with 97% of total owed assets being returned in full form. This includes both principal amounts and any market-driven gains accrued since deposit.
How Asset Distribution Works
Gemini emphasized that this is not a cash payout or a token swap. Instead, users are receiving their original assets back—in kind—which is significant for long-term holders who benefit from price appreciation.
For example:
- If a user lent 1 BTC in June 2021, they will receive 1 BTC now.
- Since Bitcoin’s price rose from roughly $35,000 in late 2021 to over $60,000 in early 2025, the user regains not just their principal but also the full market gain—without having earned interest during the freeze period.
The company expects to distribute the remaining balance—covering edge cases, verification delays, and disputed claims—within the next 12 months.
FAQ: Your Questions Answered
Q: Why did Gemini suspend the Earn program?
A: The suspension occurred in November 2022 due to Genesis’ liquidity crisis. As Gemini’s lending partner, Genesis managed the funds; when it defaulted, user withdrawals were no longer possible.
Q: Will I get all my crypto back?
A: Yes—approximately 97% of users are already seeing their full balances restored. The remaining 3% will be processed within the next year as final verifications are completed.
Q: Are there any fees or taxes on returned assets?
A: Gemini does not charge fees for returning your assets. However, tax implications depend on your jurisdiction—receiving appreciated assets may count as a taxable event upon sale.
Q: Can I use my returned crypto immediately?
A: Once credited, your assets are fully accessible. You can trade, transfer, or hold them as you wish within your Gemini account.
Q: Is the Earn program coming back?
A: Gemini has not announced plans to relaunch the program. The company is focusing on rebuilding trust through transparency and improved risk management.
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A Step Toward Trust Restoration
The return of $2.2 billion in digital assets is more than a financial correction—it’s a crucial step in restoring trust within the crypto ecosystem. After years of uncertainty, users can now regain control of their holdings, many of which have significantly increased in value.
Founded in 2014 by twin brothers Tyler and Cameron Winklevoss, Gemini positioned itself as a regulated, user-first exchange. While the Earn program fallout damaged that reputation, this large-scale repayment effort demonstrates accountability and operational resilience.
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Looking Ahead
While this development brings closure for many investors, it also serves as a cautionary tale about risks tied to high-yield crypto lending products—especially those reliant on third-party institutions without sufficient oversight.
Moving forward, experts recommend:
- Conducting thorough research before participating in yield programs.
- Diversifying exposure across multiple platforms and asset types.
- Prioritizing exchanges with transparent custody practices and insurance coverage.
Gemini’s asset return initiative sets a precedent for responsible post-crisis management in the digital asset industry. As the market evolves, such actions reinforce the importance of security, transparency, and user empowerment—cornerstones of sustainable crypto adoption.
For users receiving their funds, this moment represents both relief and opportunity: a chance to reevaluate strategies, strengthen portfolios, and engage more confidently with the future of finance.