In a striking reversal, the U.S. Commodity Futures Trading Commission (CFTC) told a court Wednesday evening that it now supports Gemini’s motion to be relieved from the judgment in the agency’s 2022 enforcement case against the crypto exchange. After a thorough internal reexamination, the CFTC said it concluded the original complaint should not have been filed and would not be brought under its current enforcement approach. The agency outlined several key findings behind that determination: - The complaint depended largely on a whistleblower account the CFTC now regards as lacking credibility. - The investigation focused on Gemini—characterized by the agency as a victim of fraud—rather than on the alleged fraudsters at the core of the underlying dispute. Instead, the case pursued allegations that Gemini made false statements in its registration application. - There were “serious questions” about the strength of the evidence against Gemini. - Agency personnel improperly influenced the CFTC’s regulatory authority in ways that created settlement leverage. Because of these conclusions, the CFTC said continuing to enforce the consent order’s prospective provisions would no longer serve the regulator’s mission or the public interest. The agency noted that the consent order’s non-prospective elements—most notably the civil monetary penalty—have already been satisfied, and it argued that leaving remaining prospective measures, including injunctive relief, in place would be inequitable. Background: Gemini settled the CFTC’s claims in January 2025, near the end of the Biden administration. Under that settlement the exchange paid a $5 million penalty and agreed to an injunction barring it from making false or misleading statements to the CFTC. Why this matters: It’s unusual for a regulator to publicly disavow its own enforcement action after filing a case. The CFTC’s reassessment highlights concerns around whistleblower-driven allegations, evidentiary strength, and internal conduct—issues that could influence how regulators handle crypto enforcement going forward and could encourage fresh scrutiny of past settlements. Featured image created with OpenArt; chart from TradingView.com.
CFTC Reverses 2022 Gemini Enforcement Case, Backs Vacating Consent Order
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Summary
The U.S. Commodity Futures Trading Commission (CFTC) has reversed its 2022 enforcement actions against Gemini, backing the exchange’s motion to vacate the consent order. The CFTC found flaws in the original case, including a questionable whistleblower account and misplaced focus. The agency said the CFT (Countering the Financing of Terrorism) and public interest no longer supported the order’s enforcement. Gemini settled in January 2025 with a $5 million penalty and an injunction.
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