Judge refuses to undo Gemini CFTC settlement despite agency U-turn

The Gemini CFTC settlement will stay on the books. U.S. District Judge Alvin Hellerstein in Manhattan on Thursday rejected an unusual joint request from the crypto exchange and the Commodity Futures Trading Commission to vacate the January 2025 consent order, even though the agency now says it should not have brought the case. Gemini has already paid the $5 million penalty, and the ruling keeps a permanent injunction in place.

What happened

The consent order resolved CFTC allegations that Gemini made false or misleading statements to agency staff during the 2017 review of a proposed bitcoin futures contract, CoinDesk reported. Gemini settled three weeks before trial without admitting or denying the allegations.

On May 28, the two sides jointly asked the court to wipe the order away, The Block reported. The commission said it would not have filed the complaint under its renewed enforcement priorities, and Gemini argued it had settled under coercive regulatory pressure.

Hellerstein was not persuaded. "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 wrote, adding that the CFTC's present view "does not require vacatur or other relief." He noted Gemini litigated for about three years before making "the calculated decision to settle the case shortly before trial."

Why it matters

The ruling draws a line under one assumption in crypto circles: that a change of tone in Washington can erase old enforcement outcomes. Courts, not agencies, own consent judgments, and a judge can decline to unwind one even when both parties want it gone. Other firms that settled before the policy shift now have a signal that reopening their cases this way will be hard.

For Gemini, the practical effect is reputational and procedural. The order still bars it from misleading the CFTC and from publicly denying the settlement's findings, CoinDesk said. That matters as the exchange leans harder on U.S. products after announcing exits from the U.K., the European Union and Australia and a 25% workforce cut earlier this year, with prediction markets part of its pivot.

The decision also lands as the administration's crypto policy apparatus thins out, with the White House crypto council's director departing, and as the CFTC pushes its own agenda on leveraged retail crypto trading. The Gemini CFTC settlement shows that agenda cannot rewrite court records.

What's next

Gemini had not responded to requests for comment on the ruling, CoinDesk said, and The Block said it had contacted both Gemini and the CFTC. Neither side had laid out a next step in those reports.

Watch whether other companies with legacy settlements try a narrower route than full vacatur. Any such filing would show whether the Gemini CFTC settlement ruling becomes a template for how far a regulatory reset can reach.