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In an adversary action filed in October, Gemini said the crypto lender's earlier Chapter 11 plan would have shortchanged $1.6 billion worth of Earn users' collateral. Genesis in November filed an adversary action against its former partner to recoup $689 million it alleged Gemini fraudulently pulled from the platform in the months leading up to the bankruptcy.

Last month, Judge Lane approved a settlement between the companies for Genesis to return 97% of Earn user crypto on a coin-for-coin basis in the short term and return the remaining 3% of assets once it had pursued claims against its parent company, crypto venture capitalist firm Digital Currency Group Inc. Gemini said in Wednesday's announcement Earn users can expect their remaining crypto to be returned in the next 12 months.

Gemini will also pay $50 million toward the Earn user recovery, according to its announcement.

Sean A. O'Neal of Cleary Gottlieb Steen & Hamilton LLP, who is representing Genesis in its bankruptcy, said in a statement to Law360 that by returning the cryptocurrency in kind, Earn user creditors will see a higher recovery.

"Unlike many crypto cases, Genesis did not seek to cap creditor claims at petition date values. Our goal has been to maximize creditor recoveries," O'Neal said.

Genesis Global returns $2.18 billion

Counsel for Gemini also highlighted the settlement's return of Earn user assets on a coin-for-coin basis.

"Throughout the restructuring process, Gemini steadfastly advocated for its users and, as a result of these efforts, was able to obtain a completely unprecedented 232% overall recovery for Gemini Earn users," said Anson B. Frelinghuysen of Hughes Hubbard & Reed LLP in a statement.

Genesis is represented by Sean A. O'Neal, Luke A. Barefoot, Jane VanLare and Thomas S. Kessler of Cleary Gottlieb Steen & Hamilton LLP.

Gemini is represented by Anson B. Frelinghuysen, Dustin P. Smith, Erin E. Diers, Jeff Margolin, Carl Mills, Elizabeth A. Beitler, Libby Ro and J. Scott Sanders II of Hughes Hubbard & Reed LLP.

The bankruptcy case is In re: Genesis Global Holdco LLC et al., case number 1:23-bk-10063, in the U.S. Bankruptcy Court for the Southern District of New York.