The Attorney General of the State of New York, Letitia James, declared that her office had reached a $2 billion settlement with the cryptocurrency company Genesis to reimburse investors who had been duped.A bankruptcy court has accepted the $2 billion settlement between authorities and Genesis Global Capital, Genesis Asia Pacific, and Genesis Global Holdco, according to a letter sent by the New York AG on May 20.The settlement forbids Genesis from conducting business in New York and mandates that the money be repaid to the investors. James asserted that Genesis had been deceiving and misleading investors by sending over $1.1 billion to the platform via the Gemini Earn initiative. A Genesis representative who was contacted by Cointelegraph pointed to the company’s May 17 statement.
“Our goal throughout this process has been to maximize value for all creditors, and we are gratified that the court approved both our [bankruptcy plan] and the NYAG settlement agreement,” said Genesis interim CEO Derar Islim.
In October 2023, the Attorney General’s office in New York filed a lawsuit against Genesis. Subsequently, the litigation was expanded to encompass the Digital Currency Group, its CEO Barry Silbert, and Soichiro Moro, the previous CEO of Genesis. According to James, the settlement provisions only applied to Genesis; the other defendants and the Gemini Trust Company would still be targets of the litigation.
The New York AG filed many actions against cryptocurrency companies operating in the state, the most recent of which being the Genesis settlement. James’ office sued KuCoin in 2023 for acting as an unlicensed exchange and asserting that Ether was a security at the time. The lawsuit was resolved for $22 million with the company. In addition, the New York AG sued former Celsius CEO Alex Mashinsky, alleging that he concealed the platform’s “dire financial condition.” Mashinsky is scheduled to go on trial in January 2025. He is presently being charged with crimes in the Southern District of New York, including securities fraud, wire fraud, and conspiracy to conduct fraud.