Genesis, a bankrupt crypto lender, has agreed to pay $21 million to settle charges brought by the U.S. Securities and Exchange Commission (SEC). The SEC accused Genesis of conducting an unregistered offering of digital asset securities through its online platform.
The settlement comes after the SEC alleged that Genesis had violated federal securities laws by offering and selling digital asset securities without properly registering the offerings. The SEC claimed that Genesis had raised approximately $2.3 billion through its unregistered offerings.
As part of the settlement, Genesis has agreed to pay $21 million in disgorgement and prejudgment interest. The company has also agreed to cease and desist from committing any further violations of the securities laws.
The SEC's enforcement action against Genesis is part of a broader crackdown on the cryptocurrency industry. Regulators have been increasing their scrutiny of the sector in recent years, citing concerns about investor protection and market integrity.
Genesis's bankruptcy adds another layer of complexity to the case, as the company may not have the financial resources to fully satisfy the settlement amount. The SEC will likely work with the bankruptcy court to determine how best to distribute the funds recovered from Genesis to affected investors.
Overall, the settlement between Genesis and the SEC highlights the regulatory challenges facing the cryptocurrency industry. As the industry continues to evolve, companies operating in the space will need to ensure compliance with securities laws to avoid facing similar enforcement actions in the future.
