Winklevoss twins Tyler and Cameron have agreed to return at least US$1.1 billion to customers of Gemini, the cryptocurrency exchange founded by the brothers.
A settlement with the New York Department of Financial Services (NYDFS) was reached, with the owners of the failed platform also agreeing to pay a US$37 million fine for “significant failures”.
This settlement comes after the exchange's Earn program was suspended amid a cryptocurrency market downturn in November 2022, resulting in customer losses.
Gemini’s Earn program, which was abruptly halted, left many customers unable to access their funds, primarily a result of the company’s inadequate due diligence on an unregulated third-party partner, which was later implicated in a substantial fraud case.
Superintendent Adrienne Harris of the NYDFS said: "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.
“Today's settlement is a win for Earn customers, who have a right to the assets they entrusted to Gemini."
The Winklevoss Twins, known for their legal dispute with Facebook, could face further action if the US$1.1 billion isn’t returned to customers.
Gemini in a blog post said it "worked tirelessly over the past 15 months to advocate for Earn users and seek the return of their assets".
"If approved, we will be returning over $1.8 billion in value (at today's prices) — $700 million more than when Genesis halted withdrawals on November 16, 2022."
Additionally, Gemini has committed $40 million to aid in the conclusion of Genesis Global Capital's bankruptcy proceedings, aiming to benefit the Earn program's customers further.