The U.S. Securities and Exchange Commission has formally dismissed its civil enforcement action against Gemini Trust Company with prejudice—meaning it cannot be refiled—after Earn program participants recovered 100% of their digital assets in-kind through the Genesis bankruptcy process, marking a significant victory for the Winklevoss-led exchange and offering relief amid evolving crypto regulatory landscapes.
Filed in January 2023, the lawsuit accused Gemini and Genesis Global Capital of offering unregistered securities via the Gemini Earn lending program, which allowed users to loan crypto for yield but froze withdrawals amid the 2022 market turmoil. Genesis later settled separately, while Gemini fought the charges, emphasizing compliance and user protection. The resolution follows full repayments exceeding initial values due to asset appreciation, rendering further enforcement unnecessary according to the joint court stipulation.
As Crypto Zibber posted on X: “🚨 SEC DROPS LAWSUIT AGAINST GEMINI! The SEC has finally dismissed its lawsuit against Gemini with prejudice, meaning it can’t be refiled. The dismissal came after all investors in its lending program recovered their assets in full.”
This outcome aligns with broader trends of retreating enforcement actions under new leadership, potentially encouraging innovation in lending and yield products while reinforcing that investor restitution can resolve disputes without prolonged litigation. For the industry, it underscores the importance of robust recovery mechanisms in crisis scenarios and may deter similar suits where harms are fully remedied.
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The closure eliminates lingering uncertainty for Gemini, allowing focus on growth initiatives as mainstream adoption accelerates.
The community celebrates this as a landmark win amid changing tides. Connect with us and join the discussion. Follow us on TikTok, YouTube, X, and Instagram.
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