Gemini Freezes Earn Withdrawals(gemini.com) |
Gemini Freezes Earn Withdrawals(gemini.com) |
Freezing withdrawals means they are screaming "we are insolvent" even if they aren't.
What makes you think they're willing to compensate their customers? Sure, it might be great for their reputation to do so, but they offered no such guarantees[1] and such a bailout will be tremendously expensive.
[1] https://www.gemini.com/legal/gemini-earn-program-terms-and-a...
Welp, once again I am proud of myself for being a gambler with the winds of luck at my back, and this is another example: I took out all my GUSD -> USD including a couple thousand $ profit from the Earn program a few weeks ago. Not because I was ahead of the game but because I used that $ for my house remodel. Thanks Gemini!
Gemini the exchange is supposedly regulated similar to an American bank and as far as I know not directly affected by or responsible for the pausing of Earn withdrawals. My hope is that it's a matter of low liquidity at a moment rather than some1 ran out the back door w/ the loot.
It does not protect you from Gemini losing or stealing the funds.
> This FDIC “pass-through” insurance may be available in the event that the Bank holding such U.S. dollar cash deposits becomes subject to resolution or similar proceedings by the FDIC.
https://support.gemini.com/hc/en-us/articles/205823016-Are-m...
Edit: Just curious, but how did you come to believe Gemini was FDIC insured?
It is on their website, but you have enlightened me: it won't protect them from grubby Winklevoss shenanigans, only the failure of the bank, and apparently only for USD assets. From the website:
U.S. DOLLARS
U.S. dollars in your Gemini Account may be held at Silvergate Bank, State Street Bank and Trust Company, JPMorgan Chase Bank, N.A. or Signature Bank and thus may be eligible for FDIC “pass-through” insurance, subject to applicable limitations. Please see the FDIC Insurance section of our User Agreement for more information.
EDIT: Oh, my copy-paste is from the very link you sent. Doh.
https://www.coindesk.com/policy/2022/08/19/fdic-orders-ftx-u...
>YOUR AVAILABLE DIGITAL ASSETS WILL LEAVE OUR CUSTODY, AND YOU ACCEPT THE RISK OF LOSS ASSOCIATED WITH LOAN TRANSACTIONS, UP TO, AND INCLUDING, TOTAL LOSS OF YOUR AVAILABLE DIGITAL ASSETS.
https://www.gemini.com/legal/gemini-earn-program-terms-and-a...
The true value of the FDIC play is to scam fools.
Not really. It's true that it doesn't protect you in the event that the event gets hacked or whatever, however it does protect you from the exchange deciding to store its funds in some shady offshore bank (I think Tether does this) that later suffers a liquidity crisis.
Even FTX got fined for their abusive use of FDIC marketing...