CFTC and Gemini Jointly Move to Vacate 2022 Consent Order After Enforcement Review

TLDR:

• The CFTC admitted the 2022 complaint against Gemini should never have been filed under current standards.
• A whistleblower with known credibility issues served as the primary basis for the original complaint against Gemini.
• Agency personnel were found to have misused regulatory authority to create leverage during settlement negotiations.
• The CFTC and Gemini jointly moved to vacate prospective provisions after the civil monetary penalty was already paid.

The CFTC has joined Gemini Trust Company LLC in a motion to vacate a consent order tied to a 2022 enforcement action.

The regulator concluded that the original complaint against the crypto firm should never have been filed. After a comprehensive review, the agency found several serious problems with how the case was built and prosecuted.

The move comes amid broader shifts in federal digital asset enforcement policy across multiple government agencies.

CFTC Review Reveals Serious Enforcement Failures

The CFTC’s internal review of the Gemini case uncovered a troubling series of missteps. The complaint was largely built on testimony from a whistleblower later found to lack credibility.

Rather than targeting alleged fraudsters, the agency pursued Gemini — a company the review identified as a fraud victim itself.

The CFTC stated directly that “the complaint should not have been filed — and would not have been under current enforcement standards.”

Investigators also found that evidentiary support was withheld from a Commissioner ahead of the vote to file the complaint. This raised questions about transparency within the agency’s own decision-making process.

Litigation counsel also invoked the deliberative process privilege, blocking Gemini from accessing evidence needed for its defense.

The review found that personnel “improperly influenced the CFTC’s regulatory authority to create settlement leverage.” These findings paint a picture of an enforcement process that, in this case, went beyond its proper boundaries.

Consent Order Vacated, Prospective Provisions No Longer Apply

The parties entered into a consent order in January 2025 after the original complaint was filed in June 2022. The non-prospective provisions of that order, including the civil monetary penalty, have already been satisfied.

However, the CFTC determined that continuing to enforce the remaining injunctive and prospective provisions no longer serves the public interest.

The agency concluded that “continuing enforcement of the consent order’s prospective provisions serves neither the CFTC’s mission nor the public interest.”

As a result, both parties are now jointly asking the Southern District of New York court to vacate those outstanding provisions.

The CFTC added that applying these terms going forward “would not be equitable,” given the findings of the review.

This development fits within a wider federal reassessment of digital asset enforcement policy. Multiple agencies have revisited and resolved crypto-related cases under revised standards.

For Gemini, the outcome marks a formal acknowledgment that it should not have been a defendant in this matter at all.

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