> It really should have been obvious to me that the 7+% interest they were offering (while every real bank was doing like 0.5%) was unsustainable
Gemini may be a victim here too, as TFA explains: it's Genesis that ran the scam (with DCG being Genesis' parent company).
I think the Winklevoss brothers honestly "saw" Bitcoin before most, just like they saw FaceBook before Zuckerberg stole it from them (Zuckerberg lost not just one but two lawsuits against the twins).
They may have been blinded by Genesis/DCG: just like, say, the New-York Times and Forbes got blinded by SBF / FTX.
But I don't think it's fair to say, especially while there's a lawsuit ongoing, that you "fell" for it: they are likely just victims of Genesis (and the lawsuit shall try to determine if that's the case or not).
Now they may have sold unregistered securities, but that's very different compared to downright theft (like Genesis or SBF or so many others did).
That said I'm sorry about the $13 K loss and if it's any consolation I told someone close to GFTO of BlockFi because these 8% were obviously a scam (and I don't think BlockFi was guilty: they fell for the Genesis scam) and he managed to get his 1 BTC out of BlockFi before things went south (not too sure what eventually happened to BlockFi and people who had funds there).
> "But according to the lawsuit, in the summer of 2022, some top Gemini staff became worried enough to withdraw their own funds.
If senior executives traded their own assets based on non-public information, it'll be hard to claim that they are just a victim of Genesis/DCG and had no idea this was happening.
I can agree with most of what you're saying, but there is a sticking point that I take issue with.
> Now they may have sold unregistered securities, but that's very different compared to downright theft (like Genesis or SBF or so many others did).
I mean, is it? They compared it directly to a bank account [1], and mentioned FDIC insurance for GUSD [2]. They might have not meant for my money to be stolen, but I am quite confident that they were playing fast and loose with terms in order for me to believe that there was lower risk in this than there actually was. There's actually a word for "purposefully making someone believe something that's not true", and it's called "lying", and if they're lying then I kind of have to assume some nefarious intent.
That said, I can broadly agree that maybe they're just morons? I'm probably an idiot too, but it's a little different for a software engineer without any financial training vs. two adults trying to start "legitimate" crypto exchange without doing the proper due diligence to make sure their partners are also legitimate?
GUSD is FDIC insured though. GUSD deposited in the 'Earn' program is not. Just like your bank account dollars are no longer FDIC insured once you buy bonds with them.
Even that is a somewhat dubious claim. They even stopped emphasizing that one their website so I suspect they realize that as well.
> Just like your bank account dollars are no longer FDIC insured once you buy bonds with them.
Then their ads and tweets shouldn't have been comparing it to a bank account. That's getting into unregistered security territory. Which again, not my opinion, but what the SEC is alleging.
Gemini may be a victim here too, as TFA explains: it's Genesis that ran the scam (with DCG being Genesis' parent company).
I think the Winklevoss brothers honestly "saw" Bitcoin before most, just like they saw FaceBook before Zuckerberg stole it from them (Zuckerberg lost not just one but two lawsuits against the twins).
They may have been blinded by Genesis/DCG: just like, say, the New-York Times and Forbes got blinded by SBF / FTX.
But I don't think it's fair to say, especially while there's a lawsuit ongoing, that you "fell" for it: they are likely just victims of Genesis (and the lawsuit shall try to determine if that's the case or not).
Now they may have sold unregistered securities, but that's very different compared to downright theft (like Genesis or SBF or so many others did).
That said I'm sorry about the $13 K loss and if it's any consolation I told someone close to GFTO of BlockFi because these 8% were obviously a scam (and I don't think BlockFi was guilty: they fell for the Genesis scam) and he managed to get his 1 BTC out of BlockFi before things went south (not too sure what eventually happened to BlockFi and people who had funds there).