The US Securities and Exchange Commission charged Genesis Global Capital and cryptocurrency exchange Gemini Trust Co. on Thursday with offering and selling unregistered securities to retail investors without making the required disclosures or complying with other market participant protection measures.

SEC chair Gary Gensler said in a statement :

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

The SEC is also looking into if there were any more violations of the securities laws, as well as whether there are any other businesses or individuals connected to the whole issue.

Gemini was started by twins Tyler and Cameron Winklevoss. Investors sued the cryptocurrency exchange in late 2017 on the grounds that the company had issued interest-bearing accounts through the Gemini Earn programme without properly registering them as securities.

On Twitter, Tyler Winklevoss voiced his disappointment with the SEC’s lawsuit against Gemini. Winklevoss noted that the Gemini Earn programme is completely governed by the New York State Department of Financial Services.

He also disclosed that despite having discussed the programme with the SEC for more than 17 months, the agency had never raised the issue of additional regulatory action until Genesis suspended withdrawals due to liquidity issues.

He added,

“We look forward to defending ourselves against this manufactured parking ticket. And we will make sure this doesn’t distract us from the important recovery work we are doing.  But seriously, what is the point or urgency here? The Earn program has been shut down for almost two months.”