In summary:
Gemini settled with the CFTC by paying a $5 million fine without admitting or denying the allegations of misleading regulators.
The Winklevoss twins have supported crypto-friendly candidates but frequently criticize the CFTC’s approach to regulation.
Despite growing support for the CFTC overseeing crypto regulation, the twins’ stance could hinder the industry’s efforts.
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The Winklevoss twins of Gemini have agreed to settle a lawsuit with the CFTC, paying a $5 million fine. Gemini neither confirmed nor denied the allegations of misleading the financial regulator.
Tyler and Cameron Winklevoss made a big push to support crypto-friendly candidates in the recent election but have been critical of the CFTC on many issues. Many advocates in the industry want the CFTC to take over crypto regulation from the SEC, but the twins could complicate that effort.
Gemini and the CFTC reach a settlement
Gemini Trust Company, founded by twins Cameron and Tyler Winklevoss, has successfully avoided a legal battle with the CFTC. This legal battle began in 2022 when the CFTC sued Gemini for allegedly lying about methods to prevent Bitcoin price manipulation
“After the [CBOE] certified the proposed Gemini futures contract as eligible for listing, the CFTC, pursuant to its statutory authority, commenced its own investigation. The CFTC alleges that Gemini’s representations were false and misleading on material issues, leading to this lawsuit,”
according to their complaint
Before the settlement, the parties were set to go to court a day after President-elect Trump took office. The twins heavily backed him in the 2024 election, and this may have made a public legal battle more embarrassing. In fact, Cameron and Tyler Winklevoss have recently tried to influence crypto-friendly policy in more ways than just the CFTC. For example, they donated $1 million in November to a failed effort to unseat Senator Elizabeth Warren, a noted crypto opponent. They also praised Elon Musk’s D.O.G.E. reforms.
While this legal battle may be over with a settlement, the lawsuit dragged on for two years. So, the Winklevoss twins may continue to harbor ill feelings. In August, the twins criticized the CFTC for trying to limit prediction markets. Also, before the election, they made explicit demands about who the next SEC Chair should be.
However, since Trump’s victory, some parts of the industry have called for the CFTC to take over some of the SEC’s crypto regulation duties. For obvious reasons, neither Tyler nor Cameron Winklevoss are strong proponents of the CFTC as the main crypto regulator. However, the new Senate leadership has backed this goal, creating more momentum. This whole affair shows the fissures that can appear in a seemingly unified pro-crypto coalition.
This means the twins have not made too many specific demands for the future of crypto regulation in the U.S. besides trying to get Trump in the White House. After the election, they called for prosecutors to investigate SBF’s political donations but did not have many other specific demands. Overall, the effort to empower the CFTC to take over regulatory responsibility may move forward, but perhaps without the backing of the Winklevoss twins.
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