Judge rejects Gemini and CFTC joint bid to vacate $5 million settlement
In brief
- Judge Alvin Hellerstein rejected a joint Gemini-CFTC request to undo the January 2025 settlement, CoinDesk reported.
- The CFTC had said its case against Gemini should not have been brought.
- Gemini remains barred from misleading the CFTC or publicly denying the settlement's findings.
- Gemini has already paid the $5 million and can still operate in the U.S.
What the judge decided
Hellerstein also rejected Gemini's argument that it had been coerced into settling by regulators, CoinDesk reported. The ruling keeps the exchange under a court order that bars it from misleading the CFTC or publicly denying the settlement's findings.
Gemini, founded by Cameron and Tyler Winklevoss, has already paid the $5 million. The money isn't what's at stake.
The restrictions are.
"Gemini litigated the case for approximately three years, and then, despite the preceding facts, made the calculated decision to settle the case shortly before trial,"
That line comes from the judge's written ruling, as quoted by CoinDesk, and it points to how long the exchange fought (roughly three years) before choosing to settle.
Where the case came from
The CFTC sued Gemini in 2023, alleging it misled regulators during a 2017 review of a proposed bitcoin futures contract. Gemini settled three weeks before trial without admitting or denying those allegations. Now the regulator says the case shouldn't have been brought at all, and the company wants the judgment gone, but that wasn't enough for the court.
CoinDesk said the decision shows that earlier court judgments aren't automatically erased, even when the regulator and the company agree they should be withdrawn. Put simply, both sides agreeing doesn't make the judgment disappear on its own.
What it means for Gemini
Gemini can still operate in the U.S. and introduce new products, but it'll have to live with the terms of its 2025 settlement. Earlier this year, the exchange announced plans to exit the U.K., European Union and Australia and cut 25% of its workforce as it shifted resources toward the U.S. market and prediction markets. It said it would keep operating in Singapore.
Gemini hadn't responded to CoinDesk's request for comment on Thursday's ruling.
Frequently asked questions
Why did the judge keep Gemini's CFTC settlement in place?
Judge Alvin Hellerstein ruled that the CFTC's reversal of its position wasn't enough to undo Gemini's January 2025 settlement, according to CoinDesk. He also rejected Gemini's argument that regulators had coerced it into settling, noting the exchange litigated for about three years before settling shortly before trial.
What did the CFTC originally allege against Gemini?
The CFTC sued Gemini in 2023, alleging it misled regulators during a 2017 review of a proposed bitcoin futures contract. Gemini settled three weeks before trial without admitting or denying the allegations.
What restrictions does Gemini still face after the ruling?
Gemini remains under a court order that bars it from misleading the CFTC or publicly denying the settlement's findings. It can still operate in the U.S. and introduce new products, but must stay bound by the terms of its 2025 settlement.
