Gemini to Settle Bitcoin Futures CFTC Case for $5 Million
Gemini Reaches $5 Million Settlement with CFTC Over 2017 False Bitcoin Futures Contract Allegations
Gemini Trust Company and the US Commodity Futures Trading Commission (CFTC) have reportedly reached a settlement that could prevent a civil trial originally set for January 21, 2025 over allegations from Gemini’s 2017 Bitcoin futures contract bid.
The firm disclosed the agreement in a January 6 filing in the US District Court for the Southern District of New York. The agreement mandates Gemini to pay a $5 million civil monetary penalty and refrain from making false or misleading statements to the CFTC.
Gemini Acknowledges Misleading Statements
As part of the agreement, Gemini acknowledges errors in it previous statements.
According to investigations, Gemini failed to transparently disclose fee arrangements it had with select market participants, including market makers. These arrangements offered favorable terms the company failed to list on its website and promoted trading in the Gemini Auction.
The CFTC initially filed the case against the firm in June 2022, alleging that the company’s lack of transparency constituted a form of market manipulation. However, the firm did not publicly admit or deny the allegations due to the agreement.
The court previously slated the trials for January 21, 2025, a day after president elect Donald Trump’s inauguration.
CTFC’s Regulatory Crackdowns on Crypto Firms
This settlement is part of a broader effort by CFTC to enforce US commodities laws in the constantly growing crypto sector. In December 2024, the commission reported recovering over $17 billion in civil monetary penalties, disgorgement, and restitution during the fiscal year.
In August, the court ordered FTX and its sister company, Alameda research to pay $12.7 billion to settle charges served by the CFTC in what the agency admits is its largest recovery ever. The agency also has several cases pending with crypto firms over alleged violations of US commodities laws.
Reports suggest President-elect Donald Trump is reportedly considering replacing current CFTC Chair Rostin Behnam. These reforms are part of pro-crypto policies aimed at mitigating regulatory crackdowns surrounding cryptocurrencies. However, unlike at the US Securities and Exchange Commission, no commissioners at the CFTC have revealed plans of resigning ahead of the incoming Trump administration.
