US CFTC Joins Winklevoss Twins’ Gemini to Withdraw $5M Penalty

The U.S. Commodity Futures Trading Commission (CFTC) on Thursday said it has joined the Winklevoss twins’ Gemini crypto exchange in dismissing a Biden-era $5 million civil penalty imposed on the exchange. This marks a major development under the pro-crypto Trump administration, with the agency claiming the case should have never been filed.

US CFTC Asks Court to Nullify Penalty in Biden-Era Gemini Case

The CFTC has filed a joint motion for relief from judgment in CFTC v. Gemini Trust Company LLC in the SDNY Court, according to an official press release. The regulator has asked the court to vacate the $5 civil penalty imposed against the Winklevoss twins’ crypto exchange.

“The CFTC conducted a comprehensive review of the history of the investigation, the evidence, the charging decision, the litigation tactics in the matter, and considered changes in federal digital asset policy resulting in the resolution of numerous digital asset investigations and cases across multiple government agencies,” it added.

In 2022, the CFTC accused Gemini of making false and misleading statements and omissions to the regulator during a review of a Bitcoin futures product.

In January 2025, during the final weeks of the Biden administration, Gemini agreed to pay the $5 million penalty without admitting or denying the charges. Also, it included a permanent injunction barring the company from making future misleading statements to the CFTC.

The decision now rests with a judge, who must decide whether sufficient grounds exist to vacate the consent order. Legal experts characterized it as “an extraordinary step.”

Earlier this year, US SEC successfully dropped Gemini lawsuit after investors fully recover funds, marking a major crypto legal win and closure of the Earn program case.

CFTC Claims the Case Invalid under Current Enforcement Standards

As per court filings, the CFTC has worked to dissolve the settlement in the last few days. It stated the “complaint should not have been filed” and is not in line with current enforcement standards.

The regulator added that the complaint was largely based on a whistleblower’s account known to be lacking in credibility. Instead of focusing on alleged fraudsters, the investigation pursued Gemini for purported false statements to the CFTC during a registration application process.

Moreover, the evidence against Gemini lacked strength and the requested evidentiary support was withheld from a Commissioner while the CFTC voted on the complaint against Gemini.

The complaint put the Biden-era CFTC’s internal deliberations at issue, “but then litigation counsel invoked the deliberative process privilege and interposed objections to prevent Gemini from obtaining evidence necessary to defend itself.” It added that personnel improperly influenced the regulatory authority to create settlement leverage.

According to private texts between Trump’s former CFTC chair pick Brian Quintenz and Tyler Winklevoss, Quintenz refused to take a position in the enforcement action until he was fully confirmed as Chair. Now, it looks like new Chairman Mike Selig sided with the Winklevoss twins in concluding the CFTC should not have brought the Gemini case.

The latest CFTC’s decision to drop the penalty comes amid pro-crypto regulations. In April, Gemini secured CFTC approval to operate as a Derivatives Clearing Organization (DCO), expanding footprints in the derivatives and prediction markets.