The lawsuit filed on Thursday focuses on Gemini Earn, interest-bearing product that allowed Gemini users to lend out their crypto assets to Genesis with the promise of high-yields.
The development underscores the challenges the crypto industry continues to face almost a year after the bankruptcy of Sam Bankman-Fried's exchange FTX, which led to a meltdown in the sector that overwhelmed several major firms. Through the lawsuit, Attorney General James is seeking restitution for investors and "disgorgement of ill-gotten gains," along with a ban on all the three cryptocurrency firms from the financial investment industry in New York.