NEW YORK — A $5 million settlement Gemini struck with federal regulators in the final days of 2024 will stay in place. U.S. District Judge Alvin Hellerstein refused on Thursday to vacate it, turning down a joint request from the CFTC and the exchange.
Thursday’s decision leaves the consent order untouched. Hellerstein entered that order on January 6, 2025, in the Southern District of New York. Gemini has already paid the $5 million penalty in full. The permanent injunction stays in force.
The CFTC’s lawsuit dates to June 2, 2022. It accused Gemini Trust Company of misleading the agency in 2017, during its review of a proposed bitcoin futures contract.
Cboe proposed the contract, which would have settled on prices from Gemini’s own bitcoin auction. The complaint alleged that what Gemini told regulators about trade funding, fee rebates, self-trading and auction volume was false or misleading.
Gemini fought the case for three years. It agreed to settle on December 24, 2024 — fewer than three weeks before trial.
What changed came after the settlement. Gemini got the agency’s internal records through Freedom of Information Act requests — about 16 productions in all, ending in May 2026. The CFTC took another look at its own case and concluded the complaint should not have been filed.
The joint request, filed May 27, asked the court to vacate the consent order under Rule 60(b) of the Federal Rules of Civil Procedure. The filing said enforcement staff had built the case mainly on a whistleblower they knew was not credible. It also said staff withheld evidence from a commissioner before the vote to authorize the lawsuit and used a separate regulatory application as settlement leverage.
Hellerstein held that none of it met the standard for undoing a final judgment. The internal records, he wrote, concerned facts that already existed when the case settled. Learning of them later was not the significant change in circumstances Rule 60 requires, and the agency’s new view of its own case was not a change in the law.
“The CFTC’s present assessment that this action should not have been brought does not require vacatur or other relief.”
He also rejected the suggestion that regulatory pressure had made Gemini’s consent involuntary. Gemini had counsel, had litigated for years and had agreed to settle on its own, the order said.
The ruling keeps the consent order’s terms in place, including the injunction barring false or misleading statements to the agency. For Gemini, the filing said, those terms matter because a prior enforcement record can count against it in any future case. The CFTC remains free to weigh its current policies in any future decision on enforcing the order, the judge noted.
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