SEC accuses Gemini and Genesis of selling unregistered securities. July 15, 2026 Since the beginning of the year, Gemini and Genesis - two of crypto's top companies - have been locked in an increasingly loud dispute over an investment product that promised customers high yields for lending their crypto assets. On Thursday, the U.S. Securities and Exchange Commission charged both companies with the unregistered offer and sale of securities to retail customers in a complaint filed in the U.S. District Court for the Southern District of New York. "Today's charges build on previous actions to make clear to the marketplace and the investing public that crypto lending platforms and other intermediaries need to comply with our time-tested securities laws," SEC Chair Gary Gensler wrote in a statement published on the agency's website. Gemini is a crypto exchange founded by Cameron and Tyler Winklevoss, known for their Bitcoin fortune and ending up on the wrong side of the Facebook saga, as memorialized in The Social Network. In 2021, Gemini partnered with Genesis Trading - a crypto lending firm that's part of Barry Silbert's Digital Currency Group empire - to launch a new product called Gemini Earn, where customers could earn yields approaching 8% for storing cryptocurrencies on the platform. Genesis generated the returns by loaning the money to institutional investors. After November's collapse of FTX, Genesis suspended redemptions, disclosing that it had about $175 million in funds locked up on the failed exchange. That, in turn, hurt Gemini, with Cameron Winklevoss writing in an open letter to Silbert published on Jan. 2 that Genesis owed $900 million to repay around 340,000 Gemini Earn customers. Gemini officially shut down its Earn product on Jan. 8. Two days later, in another open letter, Cameron Winklevoss demanded that DCG's board remove Silbert as CEO. Gemini Earn customers have still not been able to withdraw their crypto assets. Thursday's SEC charges come after a report last Friday from Bloomberg that Genesis was under investigation by both the SEC and the U.S. Department of Justice for internal financial dealings. It is unclear if the investigations are related. In its statement, the SEC said Gemini deducted an agent fee as high as 4.29% from the returns Genesis paid to Gemini Earn investors, with Genesis exercising discretion on how to use the crypto assets. The SEC alleges that the Gemini Earn product constituted the offering of unregistered securities, bypassing required disclosures. In the wake of FTX's collapse, the agency has faced criticism from both the crypto industry and members of Congress for failing to regulate the volatile sector. The new charges, aimed at two of crypto's major companies, will further Gensler's long-stated claim that he is just getting started with taming an industry he describes as the "Wild West." As he said in a December interview, "The runway is getting shorter."

They are seeking damages after investing the majority of their net worth into Genesis Global Trading, a cryptocurrency firm that recently entered Chapter 11 bankruptcy.