CFTC Admits Gemini Lawsuit Was Unjustified, Seeks Court to Revoke Consent Order

Huoxing Finance reports that on Tuesday, the U.S. Commodity Futures Trading Commission (CFTC) announced it had jointly filed a motion with Gemini Trust Company LLC in the U.S. District Court for the Southern District of New York, requesting the vacatur of the prior judgment against Gemini. The case was originally filed in June 2022, and the parties reached a consent order in January 2025. After a comprehensive review, the CFTC concluded that the lawsuit should never have been initiated and would not be initiated under current enforcement standards. The review identified six key issues: the complaint relied primarily on statements from a questionable whistleblower; the investigation targeted Gemini—as a victim of alleged fraud—rather than the alleged perpetrators; there were serious doubts regarding the strength of evidence against Gemini; supporting evidence was withheld from commissioners during the CFTC’s vote on the complaint; the litigation team invoked deliberative process privilege to prevent Gemini from obtaining evidence necessary for its defense; and personnel improperly leveraged the CFTC’s regulatory authority to create leverage for settlement. The CFTC determined that enforcing the prospective provisions of the consent order is neither consistent with its mission nor in the public interest. The non-prospective provisions of the consent order—including civil penalties—have already been satisfied. The parties jointly request that the court vacate the remaining prospective provisions.