US federal judge denies joint Gemini-CFTC bid to undo $5 million settlement

A federal judge in New York has turned down a joint request from the Commodity Futures Trading Commission and crypto exchange Gemini to set aside a January 2025 consent order that imposed a $5 million civil penalty and a permanent injunction on the firm.

Judge Alvin Hellerstein of the Southern District of New York ruled on Thursday that the parties' arguments did not warrant reopening the judgment. The consent order had resolved a 2022 CFTC lawsuit alleging that Gemini made false or misleading statements of material fact to agency staff while the regulator reviewed a proposed bitcoin (BTC) futures contract.

The settlement was entered three weeks before trial was scheduled to start. Under its terms, Gemini paid the $5 million civil monetary penalty and became permanently enjoined from making false or misleading statements or omissions to the CFTC.

Arguments deemed insufficient

On May 28, 2026, the CFTC and Gemini jointly filed a motion to vacate the order. The commission said it should not have brought the complaint and would not have done so under its renewed enforcement priorities. Gemini argued that it had chosen to settle while under coercive regulatory pressure.

Hellerstein found those arguments insufficient, writing that the relevant facts were not post-judgment developments but concerned information available before the settlement. "Newly acquired knowledge of facts that existed at the time the Consent Order was entered does not constitute a significant change in factual circumstances," the court said. "The CFTC's present assessment that this action should not have been brought does not require vacatur or other relief."

The judge added that Gemini's claim of settling under regulatory pressure did not establish that its consent was involuntary. The exchange had litigated the case for roughly three years and was aware of relevant internal issues, including a fraud scheme involving its former chief operating officer, the court noted. In the end, Gemini "made the calculated decision to settle the case shortly before trial," it said.