Gemini and CFTC Reach $5 Million Settlement Agreement

Highlights:

• Gemini and CFTC have reached a $5 million agreement to put an end to a protracted court battle.
• The agreement details will refrain Gemini from providing false information to the CFTC.
• Gemini did not admit or deny the allegations levied against it by the regulatory body.

Crypto exchange Gemini and the United States Commodity Futures Trading Commission (CFTC) have finally reached a $5 million settlement agreement over a protracted court case. The agreement was reached in a joint court hearing on January 6 following the CFTC’s new filing in the U.S. District Court for the Southern District of New York.

📢 JUST IN: GEMINI TRUST CO. TO PAY $5M TO SETTLE CFTC ALLEGATIONS OF PROVIDING FALSE AND MISLEADING STATEMENTS DURING BID TO LAUNCH U.S.-REGULATED BITCOIN FUTURES CONTRACT

— BSCN Headlines (@BSCNheadlines) January 7, 2025

According to the fresh agreement details, Gemini will not only pay the stipulated fee. The trading platform also agreed that it would no longer provide false information to the CFTC in the future. Meanwhile, the new development is coming a few days after Alvin Hellerstein, the presiding New York Judge in the case involving Gemini and CFTC, postponed the case’s hearing from January 13 to January 21, 2025. The implication of the settlement is that the legal dispute will no longer extend into Trump’s tenure as previously envisaged.

Crypto in the court, more trial date movements, in CFTC v. Gemini Trust Company, the trial previously scheduled to begin on Jan 13, 2025 is hereby adjourned to Jan 21, no further adjournments will be granted. Inner City Press on the case(s) pic.twitter.com/TzEWE8tnZW

— Inner City Press (@innercitypress) December 30, 2024

Gemini Didn’t Deny the CFTC Charges

Before the latest development, many market participants were confident that the exchange would probably emerge winners of the court battle. Their sentiment stems from Donald Trump’s pro-crypto influence and probably the Winklevoss brothers’ effect as Gemini co-founders. During Trump’s campaign, the twins were outspoken and strong supporters of the incoming United States president.

Therefore, it might sound surprising that the exchange opted for settlement when they could have probably gone Scott-free. At the time of writing, Gemini’s founders and other top executives have remained silent about its decision to succumb to an agreement with the CFTC. However, it is worth noting that the trading platform agreed to the settlement without admitting or denying the charges against it by the U.S. regulatory watchdog.

Details of What Transpired Between Gemini and CFTC

The relationship between both parties broke down as far back as June 2022. According to reports, the CFTC filed a lawsuit against Gemini with the U.S. District Court for the Southern District of New York. The lawsuit alleged that the exchange issued false information about its 2017 Bitcoin (BTC) futures contract offer bid.

Notedly, the CFTC was more concerned about how Gemini plans to establish a level ground for all customers in its Bitcoin futures product. The exchange failed to provide any meaningful information on how it aims to prevent price manipulation, which the CFTC regards as a very crucial aspect of future trading. Hence, the CFTC was left with no other choice but to sue the trading platform.

Additionally, the lawsuit in 2022 faulted Gemini for engaging in undisclosed price arrangements with some selected traders, such as market makers. While such arrangements will probably boost the exchange’s auction trade, the CFTC deemed the lack of transparency unacceptable.

If both parties had not reached a settlement agreement, chances abound that the crypto exchange would face stiffer penalties if the case eventually concluded in the CFTC’s favor. The punishment ranges from forfeiting ill-gotten profits to monetary fines.

The CFTC Might Become the Main Regulator Under Trump’s Led Administration

In one of its old publications, Crypto2Community reported that the Trump-led administration might expand the CFTC’s regulatory oversight. If such happens, the CFTC will gain control over the United States crypto spot markets. With such conferment, the U.S. Securities and Exchange Commission’s (SEC) domineering influence on the crypto market would drop.

Chris Giancarlo Was Formerly At The CFTC & TODAY It’s Been CONFIRMED That The CFTC Will Be Taking A Bigger Role Than The SEC In Regulating Digital Assets Under Trump

Giancarlo Is Highly Speculated To Be Trump’s “Crypto Czar”

He Stated That He Believes The XRP Case Will Be… pic.twitter.com/4tXdoccK8W

— The Bearable Bull (@thebearablebull) November 26, 2024