Gemini And CFTC Lose Bid To Overturn $5 Million Penalty

A U.S. federal judge has rejected a joint request by cryptocurrency exchange Gemini Trust and the Commodity Futures Trading Commission (CFTC) to cancel their $5 million settlement agreement, leaving the previously paid penalty and permanent injunction in place according to CryptoNews.

U.S. District Judge Alvin Hellerstein ruled on October 15 that neither the regulator’s allegations of improper enforcement conduct nor changes in federal cryptocurrency policy justified overturning the January 2025 agreement. Gemini had already paid the $5 million civil monetary penalty before both parties filed their joint motion in May 2026.

Settlement Terms Remain Intact

The court’s decision maintains the permanent injunction barring Gemini from making false or misleading statements to the federal regulator. Judge Hellerstein found that Gemini's decision to settle approximately three weeks before its scheduled trial in January 2025 was voluntary, noting the company had spent nearly three years contesting the allegations.

The judge stated that later disclosures regarding the CFTC’s handling of the investigation did not establish sufficient legal grounds to cancel the settlement or reverse the existing judgment. He added that regret over an earlier agreement did not constitute a sufficient change in circumstances.

Regulatory Review and Background

The attempt to overturn the penalty followed an internal review by the CFTC, which concluded in May 2026 that its original 2022 complaint should not have been brought under current enforcement standards. The agency's review questioned the reliability of the whistleblower whose account supported the investigation and alleged that enforcement staff had withheld relevant information.

Despite the regulator joining Gemini in seeking relief from the court order, Judge Hellerstein concluded that the concerns did not meet the legal requirements to invalidate the voluntary settlement reached after years of litigation over a proposed Bitcoin futures product.

Key facts

• A U.S. federal judge rejected a joint request by Gemini and the CFTC to overturn their $5 million settlement.
• Gemini had already paid the $5 million penalty before the parties requested relief.
• The ruling leaves a permanent injunction in place barring Gemini from making false or misleading statements to the regulator.
• The original enforcement action began in June 2022 over a proposed Bitcoin futures contract dispute.