Gemini, a crypto exchange, reported on May 29 that users of its defunct Earn product have received $2.18 billion in their digital assets. These distributions account for 97% of the total owed to Earn users, marking a significant recovery since the collapse of crypto lender Genesis, which halted withdrawals in November 2022.

Gemini clarified that the assets were returned in kind, meaning users received the same amount of digital assets they had lent to the Earn program. This translates to a 232% recovery for Earn users, as the values of many digital assets have risen substantially compared to two years ago.

Cameron and Tyler Winklevoss, founders of Gemini, emphasized the unprecedented nature of this recovery among crypto bankruptcies, as well as bankruptcies in general. They also announced a settlement in principle with Genesis and other creditors, ensuring all Earn users will receive 100% of their digital assets back in kind.

Gemini attributed Genesis's bankruptcy to financial fraud exacerbated by regulatory uncertainties in the US, not issues within the crypto industry. The company reaffirmed its commitment to advocating for clearer regulations to support both innovation and consumer protection in the industry.

However, analysts caution that the in-kind distributions may lead to significant selling pressure as creditors liquidate their assets. Evan Cohen from thesis investor highlighted concerns about increased selling pressure now that locked-up crypto assets are accessible.

This surge in trading activity could impact Bitcoin and Ethereum prices, which have seen a modest 0.73% decline over the past 24 hours, with BTC and ETH prices currently standing at $67,640 and $3,761, respectively, according to CryptoSlate's data.