Cryptocurrency exchange Gemini has reached a settlement with IRA Financial Trust, concluding a lawsuit stemming from a 2022 security exploit that led to the theft of $36 million in crypto assets.
Background of the Lawsuit
In June 2022, IRA Financial Trust filed a lawsuit against Gemini, alleging that the exchange had misrepresented its security protections. This alleged lack of transparency, IRA claimed, made Gemini responsible for a February 2022 exploit in which hackers stole approximately $36 million in Bitcoin and Ether. The hackers reportedly gained control of IRA’s master key, allowing them to transfer and withdraw the assets.
Settlement and Case Dismissal
On July 18, Judge Analisa Torres of the United States District Court for the Southern District of New York dismissed the case with prejudice following the settlement agreement between IRA Financial Trust and Gemini. The details of the settlement were not disclosed in the filing. When reached for comment, Gemini did not respond before the publication of this article.
Gemini’s Ongoing Regulatory Issues
This settlement follows other recent regulatory settlements for Gemini. In June, New York Attorney General Letitia James secured approximately $50 million from Gemini as part of a settlement involving the Gemini Earn program. Additionally, Gemini agreed to return $1.1 billion to Earn users in an agreement with the New York Department of Financial Services (NYDFS).
The settlement between Gemini and IRA Financial Trust brings closure to a significant legal challenge for the exchange, emphasizing the importance of robust security measures and transparency in the crypto industry.
