US Judge Rejects Joint Attempt by Gemini and CFTC to Cancel $5 Million Penalty

Judge denies request to undo Gemini settlement

A federal judge in New York has rejected a joint attempt by the Commodity Futures Trading Commission (CFTC) and the cryptocurrency exchange Gemini to cancel a prior legal settlement. The settlement, which was finalized in January 2025, required Gemini to pay a $5 million civil penalty.

Judge Alvin Hellerstein ruled that the arguments presented by both the regulator and the exchange were not enough to reopen the judgment. This decision means the original fine and a permanent injunction against the company will remain in place.

Details of the court ruling

• Judge Hellerstein denied the request to vacate the January 2025 consent order.
• The original order resolved a 2022 lawsuit involving claims that Gemini misled agency staff.
• Gemini has already paid the $5 million civil monetary penalty required by the settlement.
• Both the CFTC and Gemini filed the motion to undo the order in May 2026.

Why the judge rejected the joint motion

The judge stated that the reasons provided by the two parties did not justify changing the court's earlier decision. The CFTC had argued that the original complaint should not have been filed based on its current enforcement priorities. Gemini claimed it only agreed to the settlement because of regulatory pressure.

Judge Hellerstein disagreed, noting that the facts of the case were known before the settlement was reached. He explained that learning more about existing facts after a judgment does not count as a significant change in circumstances. He also pointed out that Gemini had fought the case for three years before making a calculated decision to settle right before the trial was set to start.

Context of the original lawsuit

The legal battle began in 2022 when the CFTC sued Gemini, a cryptocurrency exchange. An exchange is a platform where people can buy and sell digital assets. The agency alleged that Gemini made false or misleading statements while the CFTC was reviewing a proposed bitcoin futures contract. A futures contract is a financial agreement to buy or sell an asset at a specific price on a future date.

As part of the settlement, Gemini is permanently forbidden from making false or misleading statements to the CFTC. This injunction remains active following the judge's latest ruling.

What is confirmed

It is confirmed that the $5 million penalty has been paid by Gemini. It is also confirmed that the Southern District of New York has officially denied the request to undo the settlement. The exchange remains under a permanent injunction regarding its future communications with the CFTC.

Sources

• The Block