Three crypto firms in New York face a lawsuit for allegedly scamming over 230,000 investors out of more than $1.1 billion.
New York Attorney General Letitia James is pursuing legal action against the Gemini Trust Company, co-founded by the Winklevoss twins, alongside Genesis Global Capital and the Digital Currency Group, owned by crypto mogul Barry Silbert.
Many recognize the Winklevoss twins from the film “The Social Network,” where their conflict with Facebook’s Mark Zuckerberg was portrayed.
The suit claims that Gemini misled investors about the risks associated with their investments, concealing that certain loans were insufficiently backed and heavily tied to Sam Bankman-Fried’s hedge fund, Alameda Research.
Genesis, its ex-CEO Soichiro Moro, parent firm Digital Currency Group, and its leader Barry Silbert are also accused of hiding over $1.1 billion in losses to deceive investors and the general public.
Attorney General James seeks to prohibit Gemini, Genesis, and Digital Currency Group from operating within New York’s financial sector. She stated that these crypto entities deceived investors and concealed losses exceeding a billion dollars, with middle-class investors bearing the brunt.
She added that many were misled to believe their investments in “Gemini Earn” were secure and would appreciate.
In response, Gemini asserted on Twitter that they, along with their users, were duped by a significant fraud. They stated their disagreement with the Attorney General’s decision to sue them, asserting that blaming a victim is illogical, and they are prepared to defend their stance.
Statements from the other implicated companies are awaited.
