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REX Shares Files Effective Prospectus for Solana, Ethereum Staking ETFs

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  • REX Shares filed a prospectus for Solana and Ethereum staking ETFs using a unique C-corporation structure, bypassing usual ETF rules.
  • ETFs plan to stake at least 50% of holdings, fulfilling investor demand for regulated crypto staking yield products.
  • SEC delays on Grayscale’s crypto ETFs boost REX Shares’ alternative legal approach, potentially setting a new market precedent.

REX Shares has filed an effective prospectus for Solana (SOL) and Ethereum (ETH) staking ETFs in the United States, which adopted regulatory workarounds to bring these products to market. Analysts believe the ETFs could launch within weeks, marking a major milestone for crypto investments.

ETF analyst James Seyffart highlighted the unique structure of these funds, noting they are registered as C-corporations—a rare setup in the ETF industry. Seyffart emphasized that these aren’t conventional 19b-4 filings but instead 40-Act funds, using alternative legal routes to bypass regulatory obstacles effectively.

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REX Shares Targets Ethereum, Solana Spot Exposure

Seyffart shared that REX Shares aims to gain spot exposure to Ethereum and Solana through Cayman-based subsidiaries. He described the structure as a “clever legal and regulatory workaround,” potentially allowing for a smoother SEC review. Such creativity could set a new precedent for crypto ETF strategies in the U.S. market.

The U.S. SEC recently clarified that staking via Proof-of-Stake protocols is not classified as a security. This regulatory clarity paved the way for REX Shares to pursue a staking-based ETF structure. According to analysts, this might help gain limited but important SEC acceptance for such crypto products.

Nate Geraci, President of ETF Store, took a “regulatory end-around,” praising the timing and design. He stated that both ETFs aim to stake at least 50% of their holdings in Ethereum and Solana. This feature fulfills a long-standing demand among investors seeking staking yield in regulated investment vehicles.

SEC Delays Grayscale’s Crypto ETF Approvals

The absence of staking capabilities in earlier Ether ETFs sparked criticism among industry executives. BlackRock’s Robbie Mitchnick, for instance, hailed their Ether ETF as a “tremendous success” but admitted it remains “less perfect” without staking—a feature many believe is essential to mirror crypto’s true yield potential.

REX Shares’ timing may also relate to ongoing delays in other crypto ETF applications. Grayscale tries to reclassify its spot ETFs from its Avalanche and Cardano trusts but the SEC has postponed its decisions on the matter, thus the applicants await official decisions and influence innovation through the use of other regulatory channels.

Earlier this year, Grayscale’s Cardano ETF proposal made people believe it could be a reality after the SEC’s recognition it got in February. However, the occurrence of a new comment period that is here now proves that the proposal is not yet approved. The delay makes the situation become uncertain highlighting the challenge crypto ETFs face within the U.S. regulatory environment.

Read More: SEC Files to Drop Long-Running Lawsuit Against Binance and CEO

US Senators Push for Major Reform in Crypto Taxation Rules

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  • US Senators Lummis and Moreno sponsor crypto tax reform aimed specifically at the 15% Corporate Alternative Minimum Tax (CAMT).
  • It applies to companies with an AFSI of $1 billion or more over three years.
  • The Senators call on the Treasury to exempt digital assets from fair value changes for equitable treatment.

US Senators Cynthia Lummis and Bernie Moreno have proposed legislation to reform crypto taxation. According to a filing, it targets the Corporate Alternative Minimum Tax (CAMT), which imposes a 15% tax on large corporations. They argue that the law creates unfair tax burdens on companies holding cryptocurrency under current financial accounting standards.

The CAMT enacted in the 2022 Inflation Reduction Act targets companies with a minimum of $1 billion of average adjusted financial statement income (AFSI) over three years. The concern is the accounting of digital assets, particularly in light of the recent changes in accounting standards that have incorporated virtual assets’ unrealized gains and losses into AFSI.

Crypto Firms Face Taxation on Unrealized Gains

The Financial Accounting Standards Board (FASB) has released a rule that mandates companies to employ fair value accounting for digital assets. This implies that companies might report crypto holdings using their current price value. Even if the price increases without selling the asset, the company might already have a tax liability on unrealized profit.

The senators warn that this could create significant tax liabilities disconnected from real economic profit. They argue that such taxation may drive businesses to shift operations overseas to avoid these rules. The combination of CAMT and fair value reporting creates a harsh environment for companies investing in digital assets in the U.S.

Initially, crypto firms were not subject to such taxation. But with the new standard ASU 2023-08 in effect, companies holding Bitcoin and other cryptocurrencies must now report them under the mark-to-market method. This change increases the risk of taxation on volatile, unsold assets, putting companies at a financial disadvantage.

Senators Urge US Treasury Action Regarding CAMT

Lummis and Moreno point out that firms in other countries are not subject to the same fair value rules. This difference gives foreign companies a competitive edge and creates tax inequality. U.S.-based digital asset firms may have to sell off crypto holdings to meet CAMT obligations, harming innovation and growth.

In 2023, the IRS recognized similar issues when it provisionally exempted insurance companies from CAMT in its Notice 2023-20. During the same time, the resignation of IRS Digital Asset Initiative leaders Seth Wilks and Raj Mukherjee before 1099-DA implementation has caused concern throughout the crypto space, drawing attention to more far-reaching systemic problems. 

The senators appeal for the prompt action of the Treasury by promulgating interim guidelines and updating the final CAMT rules. More particularly, they seek digital assets not to be subject to fair value adjustments. They aim to establish a tax framework that fosters innovation and achieves fair treatment of U.S.-based crypto businesses.

Read More: Best Crypto Presales That Could Pump Like Crazy in the Next Bull Run

U.S. and China Announce Major Breakthrough in Geneva Trade Talks

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  • U.S. and China announce major trade progress, boosting global economic stability.
  • U.S. Treasury Secretary Scott Bessent calls Geneva talks a “significant breakthrough.”
  • Tariff uncertainty remains despite positive Geneva talks, with $1.2 trillion trade deficit concerns.

In a significant diplomatic breakthrough, the United States and China announced reaching an “important consensus” and making “substantial progress” during recent trade negotiations in Geneva. This marks a major step in calming long-standing economic tensions, with both sides praising the outcome as pivotal for global economic stability and cooperation.

According to reports by Stock Talk, official statements confirm the productive outcome of the Geneva talks. U.S. Treasury Secretary Scott Bessent called the results a “significant breakthrough” likely to ease trade tensions. This development could reignite investor interest in risk assets like Bitcoin and Ethereum, typically influenced by shifts in macroeconomic and geopolitical dynamics.

Positive Trajectory of U.S-China Negotiations Confirmed

Bessent credited the Swiss government for creating a constructive environment. He confirmed that President Trump has been fully briefed and expressed confidence in the positive trajectory of negotiations. “We made substantial progress,” Bessent stated, noting that detailed announcements would be made the following day. The talks, he emphasized, were productive.

Echoing Bessent’s remarks, Chinese Vice Premier He Lifeng described the Geneva meeting as “an important first step.” He acknowledged lingering differences but stressed mutual benefits. Lifeng revealed that both nations agreed to set up a trade consultation mechanism designed to encourage ongoing dialogue and collaboration, aiming for long-term stability in bilateral trade relations.

Tariff Uncertainty Remains Despite Progress

Reuters reports that while there’s optimism around the Geneva outcome, uncertainties remain regarding current tariffs. In press briefings, neither side confirmed any immediate reduction to U.S. tariffs of 145% on Chinese goods or China’s 125% on American products. These tariffs have been central flashpoints, contributing to global supply chain disruptions and rising costs.

Despite the lack of tariff rollback announcements, Trade Representative Jamieson Greer labeled the meeting outcome “a deal” that could help narrow the U.S.’s $1.2 trillion global goods trade deficit. He emphasized the speed of the agreement, suggesting that the perceived rift may not be as deep as previously believed, which signals further room for compromise.

Both Bessent and Greer declined to answer questions from reporters but affirmed that the two-day discussions were highly constructive. A joint statement detailing the full scope of the consensus is scheduled for release on May 12. Investors and global stakeholders await more information, hoping for lasting economic de-escalation between the world’s two largest economies.

Read More: Ethereum Skyrockets After China Stimulus: Altcoin Season Starting?

Ethereum Price Skyrockets 20% After Historic US-UK Trade Breakthrough

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  • Ethereum rose 20%, crossing $2,000, following a US-UK trade deal breakthrough.
  • ETH’s open interest climbed to $25 billion, indicating increased institutional interest and confidence.
  • ETH targets $2,550 resistance, but short-term technicals suggest a potential cooldown amid volatility.

Ethereum (ETH) jumped over 20% on Thursday, surging past the $2,000 mark after news of a “full and comprehensive” trade agreement between the US and UK. The market responded with enthusiasm as macroeconomic tensions softened, setting a bullish tone for both crypto and global financial markets.

Charles Edwards, founder of Capriole Investments, highlighted on Twitter that Ethereum’s spike was predicted by the Capriole Macro Index. It tracks macroeconomic indicators and correctly signals the ETH breakout in advance. Such success supports the increasing relevance of data-driven tools in aiding trading opportunities during fast-evolving market conditions.

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Ethereum Open Interest Reaches $25 Billion

Institutional investors are investing capital into Ethereum after the rally. The blockchain data reveals Abraxas Capital acquired 49,644 ETH through Binance and Kraken. On the other hand, Ethereum’s exchange reserves decreased by 132,000 ETH within four days, indicating increasing accumulation and investor sentiment in long-term value appreciation.

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ETH derivatives also display positive signals. Open interest rose to 12.08 million ETH, which is more than $25 billion, as of Coinglass. Increased OI reflects increased speculative interest. It reflects increased optimism among traders as ETH regains steam after earlier Q1 drops due to worldwide tariff tensions.

The price of ETH followed wider market trends. Bitcoin momentarily broke past $100,000, and the prominent indices like the S&P 500 and Nasdaq rose more than 1%. The coordinated surge indicates crypto’s growing trend to track traditional equities, particularly technology, further cementing Ethereum’s increased standing as an asset with macro-sensitivity.

Ethereum Targets $2,550 Resistance

From a technical point of view, ETH regained critical support at $2,220, supported by its 14-day EMA and 50-day SMA. Having briefly touched $2,000, ETH is now targeting the $2,100–$2,250 range. Slicing through this area and staying above the 100-day SMA may propel prices toward the $2,550 resistance mark in future sessions.

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Despite the bullish setup, short-term indicators signal potential exhaustion. The RSI and Stochastic Oscillator are in overbought zones, implying a near-term cooldown. Binance Futures’ funding rate at 0.08% shows a dominance of leveraged longs, often preceding minor corrections or periods of price consolidation in overheated conditions.

Coinglass data shows  $286 million in ETH futures liquidations over the past 24 hours, including $235.98 million from shorts. Long positions accounted for $48.64 million. Meanwhile, investors remain focused on Ethereum’s trend stability amid increasing volatility and tightening global macroeconomic conditions.

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Read More: Ethereum faces make-or-break moment at $1,750 support

U.S. Senate Approves GENIUS Act with Strong 18-6 Vote for Stablecoin Reform

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  • The U.S. Senate Banking Committee voted 18-6 in favor of the GENIUS Act.
  • GENIUS Act aims to regulate U.S. stablecoins, ensuring transparency and preventing failures like TerraUSD.
  • Ripple suspended the minting of RLUSD after reaching a $300M cap pending regulation.

The Senate Banking Committee on March 13, 2025, passed the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act) with an 18-6, solidly bipartisan vote. The bill, officially titled the Guiding and Establishing National Innovation for U.S. Stablecoins Act, now advances to the full Senate for debate and a final vote before potential enactment.

The GENIUS Act is looking to provide for regulation of stablecoins, which are digital assets that are backed by fiat currencies such as the U.S. dollar. These coins are crucial in the cryptocurrency ecosystem, offering price stability. However, they have operated in a regulatory grey area, prompting lawmakers to push for clear and enforceable legal standards.

GENIUS Act Seeks to Prevent Future Stablecoin Collapses

Cryptocurrency journalist Eleanor Terrett shared on X that a group of U.S. senators, led by Ruben Gallego, are raising concerns about the GENIUS Act’s provisions. The joint statement they issued is critical of the revised text, advocating for increased anti-money laundering measures as well as national security safeguards within the GENIUS Act framework.

The statement also emphasizes that foreign-issued stablecoins must be defined in terms of their treatment under the law. Legislators believe that in the absence of guidelines, risks of nationalsecurity could arise. They also emphasize the necessity of having stricter punishment for noncompliance of issuers.

The collapse of TerraUSD in 2022 still echoes in regulatory circles. As an algorithmic stablecoin with not enough backing, its collapse caused ripples in the market. The GENIUS Act strives to avoid through imposing tough design requirements, public reserve transparency, as well as regulation of all stablecoin firms domiciled in the United States.

GENIUS Act Faces Potential Senate Revisions Ahead

The GENIUS Act is receiving robust support from industry leaders such as Circle, with its backing of federal regulation of stablecoins. With support from key players in the crypto industry, the bill passage seems likely. However, dissent from the group of senators could delay the final vote and alter the bill’s trajectory.

The delay in the passing of the GENIUS Act could have serious implications for stablecoin issuers. The uncertainty of the bill has already had an impact on the industry. For instance, Tether intends to launch a fresh stablecoin for users in the United States that will compete with the USD1 stablecoin.

Ripple suspended minting of the RLUSD after reaching $300 million in cap due to uncertain regulatory standards. Tether is, in its turn, launching plans for its stablecoin in the United States only. The USD1 stablecoin of WLFI also awaits its listing on centralized exchanges with its fate tied to the passing of the GENIUS Act.

Read More: Are You Even in Crypto if You Don’t Know About These 4 Best Altcoins to Buy for May 2025?

OKX Re-enters the U.S. Market with Fresh Leadership After $505M DOJ Resolution

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  • OKX has re-entered the U.S. market with a new CEO and a new crypto wallet that supports over 130 blockchains, with the aim of providing more control and transparency for users.
  • The company has settled with the DOJ for $505 million and has now agreed to comply with U.S. regulations and now includes KYC checks and fraud detection.

OKX is returning to the U.S. with a new crypto wallet for U.S. citizens and a new CEO. The company left the U.S. before but is now coming back slowly with a fresh plan.

The crypto company shared the news of its coming back in a blog post on April 16 and also shared that Roshan Robert, a former director at Barclays, will now lead as the CEO in the U.S. A day before the announcement, on April 15, OKX also shared a press release saying the return includes a new Web3 wallet that people can control themselves and a fresh crypto trading platform.

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OKX Re-enters the U.S. Market with Fresh Leadership After $505M DOJ Resolution 7

The company has also added that it is focusing on improving transparency by publishing monthly reserve reports that are verified by an external firm like Hacken.

OKX New Crypto Wallet Launch for U.S.

OKX has also decided to launch a crypto wallet alongside its exchange for U.S. users. According to the report, the wallet would support over 130 blockchains and offer tools for trading, transferring funds between networks, and exploring NFTs and Web3 dApps. It would also have an AI feature that helps users find trending tokens and projects.

The wallet is designed to give users more control and freedom in the decentralized ecosystem. This relaunch comes after OKX’s settlement with the DOJ in February, where it admitted to operating without a license and agreed to comply with U.S. standards under external monitoring until 2027.

The company has now implemented a full compliance framework, including KYC checks and fraud detection.

Over 50 million Americans now use crypto: 21% of adults, research shows. 

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  • More than 55 million U.S. adults now use cryptocurrency, with ownership spanning different age groups, professions, and income levels. 
  • 76% of users trust crypto as much or more than the regular traditional banks, while many support regulation, there is also concern that if excessive rules are imposed on it, it could stifle innovation. 

Over 50 million people in the United States now use cryptocurrency, a new study reveals. This study highlights how much digital assets have become a part of daily money matters.

This study, reported by the National Cryptocurrency Association and conducted with The Harris Poll, showed that over 55 million adults in the U.S. now use digital assets. The study showed that this ownership is widespread, cutting across different age groups, job types, and income levels. Most holders are under 45, and almost 9 million are over 55. 

According to the research, many work in different fields ranging from construction to healthcare, which further proves that crypto is no longer limited to a specific group of people. About 39% have used digital assets in the past for making purchases, with most of them doing so at least once a year; others have used it as a means to send funds to family, take part in online games, or run their businesses.

Beyond just transactions, 76% of users said it has improved their lives by giving them more financial freedom, access to knowledge, and a role in an evolving industry. 

Almost a third of users are women; some earn higher incomes, but many others do not. Surprisingly, more crypto holders work in the construction field than in finance. The study, which was based on 10,000 participants, shows that digital assets are not just a form of investment but a practical tool for daily life.

Crypto Adoption and Public Sentiment in the U.S.

76% of crypto holders trust in the asset, seeing it as reliable and even more trustworthy than traditional banks. While many support regulation (64%), there is also a genuine concern (67%) that if there are too many rules, then it hinders innovation. 

Crypto is also being used beyond finance, with holders citing benefits like learning (45%) and the excitement of being part of an innovative field (45%). Despite the rising concerns about scams (75%), actual fraud cases are rare (3%).

In the crypto space, education remains a priority, with 81% ready to expand their knowledge, turning to news sources and online content. Overall, it could be seen that digital assets are becoming a mainstream part of daily life in the U.S., with users optimistic about its role in financial inclusion. 

Related Reading | Pi Network Crashes 81% After Mainnet Launch

Coinbase CLO Criticizes the US Treasury for Over Tornado Cash Sanctions

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  • U.S. Treasury lifts Tornado Cash sanctions after blacklisting it in 2022 for laundering $7 billion.
  • Coinbase CLO Paul Grewal criticizes the Treasury for sidestepping a court ruling on Tornado Cash.
  • Legal uncertainties remain as Grewal warns of potential reimposition of Tornado Cash sanctions.

On Friday, the U.S. Treasury lifted sanctions on crypto mixer Tornado Cash, accused of laundering over $7 billion, including funds linked to North Korean hackers. The Treasury had blacklisted the platform in 2022, citing its role in laundering $455 million stolen by the Lazarus hacking group.

Coinbase CLO Criticizes Treasury’s Move

However, the decision has sparked strong criticism. Coinbase Chief Legal Officer (CLO) Paul Grewal publicly condemned the Treasury for its handling of Tornado Cash’s delisting. In a strongly worded X post, he argued that the Treasury is attempting to sidestep a final court ruling on the case, which undermines legal procedures.

Grewal asserted that the Treasury’s recent filing seeks to moot the need for a final judgment, claiming the case is no longer relevant after Tornado Cash’s removal from the Specially Designated Nationals (SDN) list. However, he pointed out that such a filing is only valid if the defendant can prove the issue won’t recur.

The Coinbase CLO highlighted past cases where sanctions were lifted, yet the cases remained open, enabling the government to reimpose sanctions at will. He stressed that the Treasury has not provided any assurance that Tornado Cash won’t be blacklisted again in the future.

Coinbase, Ethereum Foundation Support Tornado Cash

Grewal’s criticisms come amid an ongoing court battle. Users of Tornado Cash contested the Treasury’s action of adding the platform to the SDN list, claiming that its smart contract does not qualify as a property under the IEEPA because it is immutable.

The court sided with the users, ruling that Tornado Cash’s smart contract does not qualify as property under IEEPA. Despite the legal arguments aside, Grewal reproached the Treasury for not fully complying with the court order and for continuing to try and evade a legal resolution to the case.

Tornado Cash has gained plenty of attention from Coinbase and the Ethereum Foundation, who have been funding the legal defense of lead developer Alexey Pertsev. Other participants in the cryptocurrency market contend that the Treasury’s stance was too harsh and ungrounded.

The removal of sanctions from Tornado Cash marks a significant milestone in the ongoing potential regulation of crypto mixers. The uncertainty about the Treasury’s future actions, along with the legal ambiguity that still exists, might reimpose sanctions in the future, fueling the debate on the legal status of Tornado Cash.

Read More: Coinbase in Advanced Talks to Acquire Crypto Derivatives Exchange Deribit

SEC Crypto Enforcement Drops 30% in Gensler’s Final Year

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  • SEC crypto enforcement dropped 30% in Gensler’s final year, with 33 actions initiated in 2024.
  • SEC penalties reached a record $5 billion in 2024, with fraud charges in 73% of cases.
  • SEC repealed Bulletin 121 under acting chair Mark Uyeda, signaling potential regulatory shifts for crypto.

The U.S. Securities and Exchange Commission (SEC) witnessed a 30% drop in crypto-related enforcement actions during the final year of Gary Gensler’s tenure as Chair. According to Cornerstone Research, only 33 actions were initiated in Gensler’s last year, down from 47 the previous year, which had marked the peak of enforcement.

In total, the SEC charged 90 defendants in crypto-related enforcement actions during 2024, including 57 individuals and 33 firms. There was a notable decrease in administrative proceedings, which fell by more than 50% compared to the previous year. Despite the drop in actions, monetary penalties reached a record high of nearly $5 billion.

SEC Hits Record $5B in Crypto Penalties

The SEC’s enforcement actions in 2024 resulted in a record high of nearly $5 billion in penalties, including the $4.5 billion settlement with Terraform Labs. Fraud was the most common allegation, appearing in 73% of cases, while charges of unregistered securities offerings followed at 58%. Market manipulation and failures to register as broker-dealers also saw a rise.

Under Gensler’s leadership, the SEC initiated almost 80% more crypto-related actions than during Jay Clayton’s tenure, from 2017 to 2020. A substantial portion of these cases (47%) involved initial coin offerings (ICOs) and non-fungible tokens (NFTs), reflecting the ongoing regulatory challenges.

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SEC Crypto Enforcement Drops 30% in Gensler’s Final Year 9

Cornerstone reported that more than half of the SEC’s enforcement actions in 2024 occurred in September and October, with only four initiated after November’s US elections. The analysis revealed that fraud and unregistered securities were the most common allegations in crypto-related cases, accounting for 73% and 58%, respectively. It also noted a rise in charges related to market manipulation and failure to register as a broker-dealer.

Regulatory Changes Impacting the Crypto Industry

With Gensler’s departure on January 20, the SEC has begun shifting its priorities under acting chair Mark Uyeda, a Trump appointee. On January 23, the SEC repealed Staff Accounting Bulletin 121, a controversial rule that required banks and financial firms to treat cryptocurrencies as liabilities on their balance sheets.

This change is an early indication of the new administration’s regulatory approach. Some experts have expressed concern about Uyeda’s past suggestions that companies could bypass established SEC rules, potentially creating uncertainty in the regulatory environment.

While the shift in priorities may benefit some crypto firms, others, such as Boston Common Asset Management’s Lauren Compere, have raised concerns about the implications of loosening regulations. Compare cautioned that the SEC’s changing stance could allow companies to sidestep important regulatory processes, potentially destabilizing the market.

Uyeda will serve as the SEC’s temporary head while Paul Atkins, President Trump’s nominee, awaits Senate confirmation. Atkins’ confirmation is expected to take several months, and his position could further shape the future direction of SEC policies toward the cryptocurrency sector.

Read Also: SEC Unveils Revolutionary Crypto Task Force After Gensler Exit

SEC Slaps DCG with $38 Million Fine for Investor Deception

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  • The SEC fined Digital Currency Group $38 million for misleading investors about Genesis Global Capital’s financial stability.
  • DCG and GGC artificially inflated GGC’s balance sheet with a $1.1 billion promissory note.
  • Genesis filed for bankruptcy in January 2023 with $10 billion in liabilities and over 100,000 creditors.

The United States Securities and Exchange Commission (SEC) has fined Digital Currency Group (DCG) $38 million for allegedly misleading investors about Genesis Global Capital’s (GGC) financial health. The SEC found DCG concealed GGC’s losses, offering investors a deceptive sense of security. The penalty also includes a cease-and-desist order.

On January 17, the SEC issued a cease-and-desist order to DCG alongside the fine to deter future misconduct. The charges also implicated DCG’s former CEO, Michael Moro, for downplaying the financial fallout from the collapse of Three Arrows Capital (3AC), a major borrower, in mid-2022.

3AC Collapse Sparks Crypto Liquidity Crisis

The SEC’s investigation uncovered that DCG and GGC colluded to create a $1.1 billion promissory note, artificially inflating GGC’s balance sheet. Investors remained unaware of this note in 2022, which violated federal regulations and further obscured DCG’s financial stability.

Three Arrows Capital’s downfall in 2022, caused by its heavy investments in the Terra Luna project, triggered a liquidity crisis. GGC had $2.4 billion in loans extended to 3AC, and its insolvency left GGC facing at least $1 billion in losses. DCG misrepresented these losses, misleading investors about its support for GGC.

“Digital Currency Group’s negligence created a materially false impression regarding GGC’s financial health,” the SEC filing stated. The domino effect of 3AC’s collapse was felt across the crypto industry, affecting Voyager Digital, BlockFi, and other firms with significant exposure.

FTX Collapse and DCG’s Financial Woes Impact Genesis

Former Genesis CEO Michael Moro settled the charges by agreeing to pay $500,000 in civil penalties. Genesis filed for bankruptcy in January 2023, disclosing $10 billion in liabilities and over 100,000 creditors, including Gemini and VanEck, who were owed a combined $3 billion.

Regulators have targeted DCG and its affiliates since 2023. New York’s Attorney General accused DCG, Genesis, and Gemini of defrauding 29,000 investors through Gemini’s Earn Program. Genesis settled with the SEC for $21 million in this lawsuit earlier.

Genesis’ financial troubles worsened after FTX’s collapse in 2022. DCG borrowed $500 million in 2022 but defaulted on $620 million by May 2023, forcing Genesis to sue for repayment. In November 2023, DCG agreed to repay the loans by April 2024, aiding Genesis’ bankruptcy resolution.

By February 2024, Genesis and Gemini reached a settlement to distribute $1.8 billion to Gemini Earn users, pending Court approval. By May 2024, Genesis distributed $2.18 billion worth of cryptocurrency to about 232,000 users, advancing its bankruptcy process.

Read More: Cardano Founder Charles Hoskinson Hails XRP Community Resilience Amid SEC Lawsuit Struggles