Things are getting worse for the popular cryptocurrency exchange spearheaded by the Winklevoss twins
The Commodity Futures Trading Commission (CFTC) has taken the Gemini cryptocurrency to court, alleging that the Winklevoss-led cryptocurrency exchange misled the regulator about the nature of its Bitcoin futures contract, according to a report by Bloomberg.
Gemini allegedly made false statements during meetings with CFTC staff about its operations. The exchange allegedly lied about preventing market participants from making trades with themselves. The regulator claims that Gemini offered some participants fee rebates that could be exploited to engage in self-trading.
CFTC Acting Director of Enforcement Gretchen Lowe claims that enforcement action is intended to send “a strong message” about the regulator’s determination to protect the integrity of the market oversight process.
Chicago-based Cboe Global Markets announced the launch of Bitcoin futures in early December 2017. Back then, the price of the largest cryptocurrency was nearing the peak of the previous cycle.
The cash-settled contracts were based on Gemini’s auction price for Bitcoin.
The lawsuit, which was filed in the Manhattan federal court earlier today, doesn’t specify whether the attempt was linked to that landmark partnership.
In March 2019, Cboe discontinued its Bitcoin futures, claiming that it needed to reassess how it would approach the cryptocurrency space. The exchange’s exit was chalked up to waning demand for cryptocurrencies.
Juthica Chou, head of over-the-counter options trading at the Kraken exchange, believes that Cboe didn’t delist Bitcoin futures just for market demand reasons.
Earlier today, Gemini also announced that it had fired 10% of its staff due to unfavorable market conditions.
It’s unclear whether the firing spree is related to the CFTC lawsuit.
Source: https://u.today/winklevoss-twins-exchange-sued-by-us-commodities-regulator