Key Takeaways: The US Commodity Futures Trading Commission asked a federal judge to tear up a $5 million settlement with Gemini Trust Co., saying the Biden-era enforcement action relied on a whistleblower account the agency now considers not credible.
The CFTC on Wednesday filed a joint motion with Gemini in Manhattan federal court to vacate the January 2025 settlement, which resolved allegations that the exchange made false statements about its bitcoin futures business. The agency said it "concluded the complaint should not have been filed — and would not have been under current enforcement standards."
"The CFTC resorted to inappropriate tactics to bring a lawsuit and extract a settlement from Gemini," the agency and the exchange said in the joint filing, citing a whistleblower account "known to be lacking in credibility."
The complaint, filed in 2022, alleged Gemini made misleading statements about the difficulty of manipulating bitcoin futures contracts. The CFTC now says the whistleblower's allegations were based on statements from Gemini's former chief operating officer, who allegedly made threats against founders Tyler and Cameron Winklevoss and was known to lie about material facts. The agency also said two customers defrauded Gemini of $7.5 million through a coordinated rebate scheme — admissions the previous CFTC leadership "did nothing with."
If the court grants the request, Gemini's remaining obligations — including an injunction barring false or misleading statements to the CFTC — would be nullified. It was not clear whether the $5 million penalty, already paid by Gemini, would be refunded. The reversal marks the latest regulatory retreat under President Donald Trump, who has appointed crypto-friendly CFTC Chair Mike Selig.
The Winklevoss twins each donated $1 million in bitcoin to Trump's 2024 campaign. Trump's initial pick to lead the CFTC, former Commissioner Brian Quintenz, accused Tyler Winklevoss last year of lobbying the White House to stall his nomination over the lawsuit. Trump withdrew Quintenz's nomination and instead backed Selig, a former lawyer for crypto companies.
The CFTC's about-face adds to a string of crypto enforcement actions abandoned by US regulators under Trump. Gemini received approval for its prediction market product, Gemini Titan, in December 2025 — a product the CFTC had previously held up while the enforcement action was pending, according to the joint filing.
For Gemini, the vacated settlement removes a legal overhang that had restricted its communications with the regulator. The case highlights the shifting regulatory landscape for digital assets in the US, where both the CFTC and SEC have pulled back from Biden-era enforcement actions.
This article is for informational purposes only and does not constitute investment advice.
