The New York Attorney General's office has reached a settlement with Gemini, recovering $50 million for users of the now-defunct Gemini Earn program. This resolution marks a significant milestone in the legal proceedings against Gemini, requiring the exchange to compensate affected users and cease operating crypto lending programs in New York.

The settlement stems from allegations that Gemini misled thousands of investors about the risks associated with the Gemini Earn program, offered in partnership with Genesis Global Capital. The program's collapse affected over 230,000 users, including at least 29,000 New York residents. New York Attorney General Letitia James emphasized that Gemini's actions were deceptive, locking investors out of their accounts and misrepresenting the program's potential.

Under the settlement, Gemini will distribute the recovered funds to users automatically, without requiring further action. This follows the exchange's previous distribution of over $2 billion in crypto to customer accounts, completing 97% of the funds owed. The final distribution of the remaining 3% is expected within seven days.

The settlement also mandates Gemini's cooperation in the New York Attorney General's ongoing investigations into Digital Currency Group, its CEO Barry Silbert, and former Genesis CEO Soichiro Moro. This cooperation aims to uncover the truth behind the Gemini Earn program's collapse and ensure accountability for those involved.

In conclusion, the settlement between Gemini and the New York Attorney General's office marks a significant step towards resolving the legal issues surrounding the Gemini Earn program. The recovery of $50 million for users and the cessation of Gemini's crypto lending programs in New York demonstrate the importance of regulatory oversight in the cryptocurrency industry.