The beleaguered Gemini Earn program is now the linchpin in a new set of charges filed by the Securities and Exchange Commission against both Genesis and Gemini.

In announcing the charges, the SEC says the firms “raised billions of dollars’ worth of crypto assets from hundreds of thousands of investors” in Gemini Earn, describing it as an unregistered offering that qualifies as the sale of securities to retail investors.

“We allege that Genesis and Gemini offered unregistered securities to the public, bypassing disclosure requirements designed to protect investors,” SEC Chair Gary Gensler said in the announcement. “Today’s charges build on previous actions to make clear to the marketplace and the investing public that crypto lending platforms and other intermediaries need to comply with our time-tested securities laws.”

He continued: “Doing so best protects investors. It promotes trust in markets. It’s not optional. It’s the law.”

“It’s disappointing that the [SEC] chose to file an action today as [Gemini] and other creditors are working hard together to recover funds,” Tyler Winklevoss said in a prepared response sent to Decrypt, also posted to Twitter. “This action does nothing to further our efforts and help Earn users get their assets back. Their behavior is totally counterproductive.”

Some on Crypto Twitter questioned the timing of the SEC’s announcement and why it took so long to investigate and call the Earn program out. While others said the SEC made the right decision in calling out the Earn program as unregistered securities.

Others took aim at SEC chairman Gary Gensler who many have accused of regulation by enforcement and targeting some crypto companies while becoming “cozy” with others, including failed cryptocurrency exchange FTX.

“Gensler attacked Coinbase, cozied up to SBF (biggest fraud since Madoff), spit in the face of retail investors by rejecting spot ETFs, and spent more time fining bankrupt entities and Kardashians than fixing problems,” tweeted Messari founder Ran Selkis. “He’s a crooked cop on the beat. Not a public servant.”

Launched in February 2021, Gemini’s Earn program claimed to allow customers to earn up to 7.4% APY on cryptocurrencies. By November 2022, the signs of trouble with the program began to show as the exchange warned customers of potential issues with withdrawals; the same day crypto broke, Genesis announced it would suspend client withdrawals citing the impact of the collapse of FTX on November 11.

On January 2, 2023, Gemini co-founder Cameron Winklevoss tweeted an open letter to Genesis owner DCG and its founder and CEO Barry Silbert addressing what he characterized as evasive tactics by the company and Silbert.

Winklevoss wrote that Gemini has repeatedly tried to work out “a consensual resolution” to the dispute with DCG and Genesis over returning funds to users but alleged that Silbert and his DCG had complicated the matter.

The SEC filed its complaint in the U.S. District Court for the Southern District of New York. It asks for permanent injunctive relief, disgorgement of ill-gotten gains, prejudgment interest, and civil penalties.