CFTC Seeks to Vacate $5 Million Gemini Penalty

On May 28, 2026 the Commodity Futures Trading Commission (CFTC) filed a petition in a New York federal court asking that a January 2025 consent order against Gemini Trust Company be vacated. The order, issued in the final weeks of the Biden administration, imposed a $5 million civil penalty and barred Gemini from making false statements to the agency. The CFTC’s filing argues that the original complaint was improper and that maintaining the order would be inconsistent with the regulator’s treatment of other entities.

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The CFTC sued Gemini in 2022, alleging false or misleading statements about a bitcoin futures contract the exchange sought to launch in 2017. In January 2025 the parties settled: Gemini admitted violating the Commodity Exchange Act, paid $5 million, and accepted an injunction against future false statements. The settlement was reached just before President Joe Biden left office. In 2024 Michael Selig, a Trump appointee, became CFTC chair, and the agency has since sought to reverse several Biden-era crypto actions.

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• Tyler and Cameron Winklevoss – founders of Gemini, prominent donors to Donald Trump’s 2024 campaign (over $1 million to the MAGA super PAC).

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• Michael Selig – CFTC chair appointed by Trump, overseeing the vacatur request.

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• Tim Massad – former CFTC chair, who described the vacatur move as “very unusual.”

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• CFTC staff and whistleblower – the agency now contends the whistleblower’s account was not credible.

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• Penalty: $5 million paid by Gemini (not to be refunded).

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• Political contributions: >$1 million donated to Trump’s super PAC; two attempted $1 million bitcoin donations (refunded).

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• Timeline: 2022 lawsuit -> Jan 2025 settlement -> May 2026 vacatur filing.

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The CFTC’s filing states that “inappropriate tactics” were used to extract the settlement and that the complaint “should not have been filed.” It further claims that the consent order’s prospective provisions would create a chilling effect on Gemini’s legitimate operations and on routine regulator-industry interactions. A CFTC spokesperson confirmed that the $5 million payment will remain with the agency. The agency also asserts that the vacatur aligns with a revised, more permissive enforcement approach for digital assets under the current administration.

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Former chair Tim Massad warned that the agency’s action is “very unusual” and noted that during his tenure the CFTC “only brought cases that were strong.” Observers have highlighted the timing of the request—coinciding with the twins’ political donations—to suggest potential political influence, though the CFTC frames the move as a correction of procedural errors.

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Sources agree that the CFTC now argues the whistleblower’s testimony was not credible, but no independent verification of that claim is provided. The extent to which political contributions influenced the vacatur decision remains unsubstantiated.

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• “only brought cases that were strong.” — Tim Massad

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• “These findings not only call into question the CFTC’s enforcement process in this instance but also demonstrate the necessity of the federal government’s revised enforcement approach and standards, including in the digital asset space,” — CFTC spokesperson

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• “The CFTC has further determined that the Complaint should not have been filed, and that maintaining the Consent Order’s prospective provisions would be inconsistent with the treatment of other regulated entities,” — CFTC filing

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• “The agency said it determined that “inappropriate tactics” were used to bring the case and “extract a settlement” from Gemini, which was reachedin the final weeksof the Biden administration.” — CFTC filing

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• “It also argues the settlement will “continue to have a chilling effect on both Gemini’s legitimate business operations and routine interactions” with other companies and the regulator itself.” — CFTC filing

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The court’s decision on the vacatur petition will determine whether Gemini’s penalty remains on record and could set precedent for how the CFTC handles legacy crypto settlements. The agency is expected to continue reviewing other Biden-era crypto actions, while the Winklevoss twins have indicated they will comply with any outcome.

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