Tyler Winklevoss Expresses Disappointment over the SEC’s Lawsuit against Gemini.
Winklevoss noted that the lawsuit is counterproductive to the efforts aimed at recovering the funds loaned to Genesis for Gemini Earn customers.
Tyler Winklevoss, co-founder, and CEO of Gemini has expressed his disappointment over the U.S. SEC’s lawsuit against Gemini at a time when the crypto platform is battling to recover the $900M loaned to Genesis so as to settle aggrieved customers of its Earn program. According to Winklevoss, the litigation is counterproductive to Gemini’s efforts at recovering the loan.
Recall that the SEC filed a charge against Gemini and Genesis yesterday for the alleged unregistered offering and sale of digital assets through the Gemini Earn program. According to the financial regulator, the digital assets involved are classified as securities and should have been registered with the Commission.
Winklevoss, reacting to the charge in a thread of tweets today, pointed out that the Gemini Earn program is fully regulated by the New York State Department of Financial Services (NYDFS). He further revealed that, despite discussing the program with the SEC for over 17 months, the agency never brought up the need for further regulatory action until Genesis suspended withdrawals, citing liquidity crises.
1/ It’s disappointing that the @SECGov chose to file an action today as @Gemini and other creditors are working hard together to recover funds. This action does nothing to further our efforts and help Earn users get their assets back. Their behavior is totally counterproductive.
— Tyler Winklevoss (@tyler) January 12, 2023
Speaking further, Winklevoss noted that he is also disappointed at the fact that the SEC chose to file charges and speak to the press first before informing Gemini despite the constant conversations the firm has had with the Commission. “Super lame. It’s unfortunate that they’re optimizing for political points instead of helping us advance the cause of 340,000 Earn users and other creditors,” he added.
The Gemini Chief mentioned that the firm will be defending itself in court against the SEC’s charges which he likened to a “manufactured parking ticket.” He further highlighted that Gemini has done its best to ensure that it remains in compliance with the appropriate regulations.
The SEC’s Regulatory Actions within the Crypto Space
The Gemini lawsuit is one of several actions taken against crypto entities by the SEC that the cryptocurrency community believes are unjustified. The litigation against Ripple remains one of the longest legal tussles in the crypto space, as Ripple chose to defend itself after the SEC charged the technology company in December 2020. The Commission also charged LBRY in March 2021 for allegedly offering unregistered securities.
Recently, Stuart Alderoty, Ripple’s General Counsel, highlighted the SEC’s regulatory actions within the crypto scene, deeming them inappropriate and calling on Congress to help put the agency in check. According to Alderoty, the Commission is going beyond its jurisdiction and making laws for itself.