More fissures in crypto as Winklevoss twins “pause” redemptions

Cameron and Tyler Winklevoss, who famously saw their seminal social media platform get scooped by a guy named Mark Zuckerberg, are now facing heat from customers on their Gemeni platform over a lending scheme ironically called “Earn”. The company offers its customers the ability to earn up to 8 percent by lending out crypto to Genesis, the “defi” platform owned by Barry Silbert’s Digital Currency Group (DCG).

The letter is conspicuous in the self-absolution implied in Winklevoss’ choice of words, even going so far as to express sympathy for customers who “trusted Genesis”. At no point is there any admission of culpability or apology to the customers of Gemeni’s Earn platform, whose partnership with Genesis was structured by Winklevoss’s team.

Gemeni is currently the defendant in a class action lawsuit brought by Earn customers, and there are allegations of fraud, securities law violations, and even rumours alleging co-mingling of customer funds.

Silbert’s DCG is bogged down in financial difficulties of its own as it was disclosed to shareholders that Genesis had $175 million in funds it couldn’t access on the FTX platform.

Contagion from the FTX fraud is spreading throughout the crypto universe, with further bankruptcies and criminal investigations expected throughout 2023.

James West

Editor and Publisher

James West founded Midas Letter in 2008 and has since been covering the best of Canadian and US small cap companies. He covers global economics, monetary policy, geopolitical evolution, political corruption, commodities, cannabis and cryptocurrencies. As an active market participant, James is not a journalist and is invariably discussing markets...
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