The Commodity Futures Trading Commission and Gemini Trust Company have jointly asked a federal judge to scrap a $5 million settlement the regulator imposed on the crypto exchange last year. In a motion filed late Thursday, both sides told the court the 2025 consent order 'should not have been filed.'
Why the joint motion
The agreement to unwind the penalty is unusual. Typically, regulators defend their enforcement actions. But here, the CFTC itself joined Gemini in asking for the settlement to be reversed. The regulator acknowledged the order — which stemmed from an earlier investigation into Gemini’s digital asset practices — was issued in error. The joint filing did not specify what went wrong, only that both parties now agree the penalty should never have been entered.
What happens next
The motion now goes before the judge who approved the original consent order. If granted, the $5 million penalty would be wiped out, and the underlying enforcement action would effectively be nullified. Neither the CFTC nor Gemini has said whether a new investigation or settlement might follow. For now, the joint request is pending court approval.
Unresolved questions
The filing leaves key details unanswered. Why did the CFTC initially pursue the settlement? And what changed between 2025 and now? The joint motion offers no explanation. Gemini declined to comment beyond the filing. The court has not set a date to rule on the request.
