The New York State Department of Financial Services claims that Gemini, which the twins started following their well-known argument with Mark Zuckerberg over who developed Facebook, neglected to "fully vet or sufficiently monitor" Genesis, Gemini Earn's now-bankrupt lending partner.
The Earn program, which promised users up to 8% income on their cryptocurrency deposits, was canceled in November 2022 when Genesis was unable to pay withdrawals due to the fall of infamous scammer Sam Bankman-Fried's FTX enterprise.
Since then, almost 30,000 residents of New York and over 200,000 other Earn users have lost access to their money.
Gemini "engaged in unsafe and unsound practices that ultimately threatened the financial health of the company," according to the state regulator.
NYSDFS Superintendent Adrienne Harris claimed in a statement that "Gemini failed to conduct due diligence on an unregulated third party, later accused of massive fraud, harming Earn customers who were suddenly unable to access their assets after Genesis Global Capital experienced a financial meltdown."
Customers of Earn, who are entitled to the assets they committed to Gemini, have won with today's settlement.
“Collecting hundreds of millions of dollars in fees from Gemini customers that otherwise could have gone to Gemini, substantially weakening Gemini’s financial condition,” was the unregulated affiliate that dubbed Gemini Liquidity during the crisis.
Although it did not provide any details, the regulator added that it "further identified various management and compliance deficiencies."
Gemini also consented to pay $40 million to Genesis' bankruptcy proceedings as part of the settlement, for the benefit of Earn customers.
"If the company does not fulfill its obligation to return at least $1.1 billion to Earn customers after the resolution of the [Genesis] bankruptcy," the NYSDFS stated that it "has the right to bring further action against Gemini."
Gemini announced that the settlement would "result in all Earn users receiving 100% of their digital assets back in kind" during the following 12 months in a long statement that was posted on X.
The business further stated that final documentation is required for the settlement and that it may take up to two months for the bankruptcy court to approve it.
The New York Department of Financial Services (DFS) was credited by Gemini with helping to reach a settlement that gives Earn users a coin-for-coin recovery.
Attorney General Letitia James of New York filed a lawsuit against Genesis and Gemini in October, accusing them of defrauding Earn consumers out of their money and labeling them as "bad actors."
James tripled the purported scope of the lawsuit earlier this month. The complaint was submitted a few weeks after The Post revealed that, on August 9, 2022, well in advance of Genesis's bankruptcy, Gemini had surreptitiously taken $282 million in cryptocurrency from the company.
Subsequently, the twins stated that the change was made to the advantage of the patrons.
The brothers' actions, however, infuriated Earn customers, with one disgruntled investor telling The Post that "there's no good way that Gemini can spin this."
In a different lawsuit, the SEC is suing Gemini and Genesis because the Earn program was an unregistered security.
The collapse of Earn was a significant blow to the Winklevoss twins' hopes of becoming a dominant force in the industry.
Gemini had built its brand on the idea that it was a reliable player in the wild, mostly uncontrolled cryptocurrency market.
The recent global outage of Social Media Platform X caused a stir in the online community during a time when digital media predominates. Users everywhere became frustrated and curious about the cause of this extraordinary disruption when they realized they couldn't use the platform on December 21, 2023.
Reports of the outage, which was first discovered by Downdetector, began to arrive from all over the world, affecting millions of customers. The impact of the outage has increased because Social Media Platform X, a significant player in the social media ecosystem, has grown to be an essential part of peoples' everyday lives.
One significant aspect of the outage was the diverse range of issues users faced. According to reports, users experienced difficulties in tweeting, accessing their timelines, and even logging into their accounts. The widespread nature of these problems hinted at a major technical glitch rather than localized issues.
TechCrunch reported that the outage lasted for several hours, leaving users in limbo and sparking speculation about the root cause. The incident raised questions about the platform's reliability and prompted discussions about the broader implications of such outages in an interconnected digital world.
Meta, Instagram’s parent company launched Threads, which will be a text-based conversation app, rivaling Twitter.
Threads, released on Wednesday evening, a day before its scheduled release, allows users to join up directly from their Instagram accounts; it is a platform that allows users to publish short posts or updates that are up to 500 characters. They can include links, photos, or videos up to 5 minutes long.
More than 2 billion monthly active users will be able to import their accounts into Threads once it is made available to everyone.
Threads now have 70 million signups, according to a Friday morning post by Meta CEO Mark Zuckerberg, and that number is certain to rise over the next few days. (In comparison, Instagram has 1.3 billion users that log on every day. Twitter has 259 million daily active users at the end of 2022. 13 million accounts in total are on Mastodon.)
Adam Mosseri, the CEO of Instagram, claimed that under Musk, Twitter's "volatility" and "unpredictability" gave Instagram the chance to compete. According to Mosseri in an interview, Threads is made for "public conversations," which is an obvious reference to how Twitter executives have described the service's function throughout the years.
In regards to its threads’ competitor space, Mosseri says “Obviously, Twitter pioneered the space[…]And there are a lot of good offerings out there for public conversations. But just given everything that was going on, we thought there was an opportunity to build something that was open and something that was good for the community that was already using Instagram.”
For some time now, Meta has been getting ready to introduce Threads, which it calls a "sanely run" substitute for Twitter. The response to Musk's recent limitation on how many tweets people may watch per day, according to internal business documents I've seen, served as the impetus for this week's app release. Furthermore, they assert that Meta expects "tens of millions" of users to use Threads within the first few months of its release.
As described by Mosseri, Thread is a “risky endeavor,” especially considering that it's a brand-new program that users must download. After receiving access to Threads earlier, users were able to rapidly fill out account information and follow lists by having Meta automatically pull information from my Instagram account.
In many important aspects, Threads is surprisingly similar to Twitter. Posts (or, as Mosseri refers to them, "threads") from accounts you follow are displayed in the app's main feed along with accounts that Instagram's algorithm has recommended. Reposting something allows you to add users’ opinions, and main feed answers are clearly shown. Though it might be added later, there is no feed that solely contains the people you follow.
Since Twitter has been around for a while and has amassed a distinctive network, it presents another element that Threads must deal with. It is evident from Meta's behavior that, despite Musk's theatrics over the previous few months, unseating Twitter would not be easy. It would be a mistake, in Mosseri's opinion, to "undervalue Twitter and Elon." The community on Twitter is tremendously powerful and vibrant, and it has a long history. The network effects are very powerful.
The news was announced on Twitter, by EU’s internal market commissioner Thierry Breton. Breton later took to social media, warning Twitter that it cannot escape from the legal liability consequences that are incoming.
“Twitter leaves EU voluntary Code of Practice against disinformation. But obligations remain. You can run but you can’t hide[…]Beyond voluntary commitments, fighting disinformation will be legal obligation under #DSA as of August 25. Our teams will be ready for enforcement,” Breton wrote.
Herein, he referred to the legal duties that the platform must follow as a "very large online platform" (VLOP) under the EU's Digital Services Act (DSA).
European Union Disinformation Code
A number of tech firms, small and big, are apparently signed up to the EU’s disinformation code, along with Facebook’s parent company Meta, TikTok, Google, Microsoft and Twitch.
The code, which was introduced in June of last year, seeks to decrease profiteering from fake news and disinformation, increase transparency, and stop the spread of bots and fraudulent accounts. Companies who sign the code are free to decide on the what obligations they want to make, such as working with fact-checkers or monitoring political advertising.
Apparently, since Elon Musk took over Twitter, the company’s moderation has largely reduced, which as per the critics has resulted in a increase in spread of disinformation.
However, experts and former Twitter employees claim that the majority of these specialists left their positions or were fired. The social media company once had a dedicated team that tried to combat coordinated disinformation campaigns.
Last month, BBC exposed hundreds of Russian and Chinese state propaganda accounts lurking on Twitter. However, Musk claims that there is now “less misinformation rather than more,” since he took Twitter’s ownership.
Moreover, the EU, along with its voluntary code has brought in a Digital Service Act- a law which will coerce firms to put more efforts in tackling illegal contents online.
From August 25, platforms with more than 45 million active users per month in the EU—including Twitter—must abide by the DSA's legislative requirements.
Twitter will be required by legislation to implement measures to combat the spread of misinformation, provide users with a way to identify illegal content, and respond "expeditiously" to notifications.
In regards to the issue, AFP news agency on Friday quoted a statement of a EU Commission official saying “If (Elon Musk) doesn’t take the code seriously, then it’s better that he quits.”
Direct messages delivered on the platform will be end-to-end encrypted, i.e. private and only readable by the sender and receiver. However, Chief executive Elon Musk has warned Twitter users to “try it, but don’t trust it yet,” taking into account that it is only an early version of the service.
Only users of Twitter Blue or those connected to verified Twitter accounts are currently able to use the service, which is not yet available to the general public. Additionally, users can only send text and links in conversations for now; media attachments cannot yet be sent.
In a post on its support site, Twitter writes “It was not quite there yet” with encryption. "While messages themselves are encrypted, metadata (recipient, creation time, etc) are not, and neither is any linked content[…]If someone - for example, a malicious insider, or Twitter itself as a result of a compulsory legal process - were to compromise an encrypted conversation, neither the sender or receiver would know," it further read.
Musk indicated his plans to make Twitter into a "super-app" with many features when he purchased it in 2022. There is not really a similar platform in the West to China's super-app WeChat, which can be used for anything from social media and restaurant ordering to payments and texting.
Since then, he has made a number of significant modifications to the social network, such as the addition of a subscription service and the elimination of the previous version of Twitter's blue tick badges, which were designed to combat the spread of disinformation.
For a long time, many Twitter users have demanded that the platform's private messaging function be made more secure. The UK, where the government's Online Safety Bill would impose additional rules for social media companies, reportedly in an effort to safeguard youngsters from abuse, may find Mr. Musk's timing unsettling.
Messaging services WhatsApp and Signal have both criticized this part of the Online Safety Bill, which is presently making its way through Parliament.
They expressed concerns that the legislation might weaken end-to-end encryption, which is seen as a crucial tool by privacy activists and campaigners.
Following this, heads of the two messaging platforms signed a letter demanding a rethink over the bill. According to them, the bill, in its current form, opens the door to "routine, general and indiscriminate surveillance" of personal messages. In regards to this, a Home Office spokesperson stated, "The Online Safety Bill applies to all platforms, regardless of their design and functionality. Therefore, end-to-end encrypted services are in scope and will be required to meet their duties of care to users."
"We have made clear that companies should only implement end-to-end encryption if they can simultaneously uphold public safety. We continue to work with the tech industry to collaborate on mutually agreeable solutions that protect public safety without compromising security," he added.
Meta Verified will be costing $11.99 a month on the web, while $14.99 for iPhone users, and will be made available to users in Australia and New Zealand starting this week.
According to Meta CEO Mark Zuckerberg, this act will aid to the security and authenticity on social networking sites and apps. This move comes right after Twitter announced its premium Twitter Blue subscription to its users, which was implemented from November 2022.
Although Meta’s paid subscription is not yet made available for businesses, interested individuals can subscribe and pay for verification.
Badges or “blue ticks” are offered as a verification tool to users who are high-profiled or signify their authenticity. According to a post on Meta's website:
Many other platforms such as Reddit, YouTube and Discord possess similar subscription-based models.
Although Mr. Zuckerberg stated in a post that it would happen "soon," Meta has not yet defined when the feature will be made available in other nations.
"As part of this vision, we are evolving the meaning of the verified badge so we can expand access to verification and more people can trust the accounts they interact with are authentic," Meta's press release read.
This announcement of Meta charging for verification was made following the loss faced by the company of more than $600 billion in market value last year.
For the last three quarters in a row, the company has recorded year-over-year revenue declines, but the most recent report might indicate that circumstances are starting to change.
This act will eventually aid Meta to meet its goal, which was to focus on “efficiency” to recover, since the company’s sudden fall in revenue made it to cut costs by laying off 13% of its workforce (11,000 employees) in November and consolidated office buildings.