Michaela
The U.S. Securities and Exchange Commission (SEC) has closed its investigation into Gemini, marking another firm that has avoided regulatory action — for now.
On February 26, Gemini co-founder and president Cameron Winklevoss shared an official notice from the SEC on X, confirming that the agency had ended its investigation into the crypto exchange and would not pursue enforcement action against the company.
The SEC initiated a probe into Gemini due to concerns that its “Earn” program, which was launched in partnership with Genesis Global Capital, involved the unregistered offer and sale of securities.
The program allowed Gemini users to lend their crypto assets to Genesis in exchange for interest payments. In January 2023, the SEC charged both Gemini and Genesis for failing to register this offering, alleging it violated federal securities laws.
However, the SEC emphasized that the notice does not constitute an “exoneration” and should not be interpreted as a guarantee that enforcement action will not be pursued in the future based on its investigation.
Dropped Investigation Into Gemini: Winklevoss Speaks Out
Winklevoss expressed his views on the SEC’s decision in a lengthy X post, calling it a significant step toward ending the regulatory battle against crypto. However, he argued that the move “does little” to compensate for the harm the agency has inflicted on Gemini, the broader crypto industry, and the U.S. economy.
“The SEC cost us tens of millions of dollars in legal bills alone and hundreds of millions in lost productivity, creativity, and innovation,” Winklevoss wrote.
Winklevoss further criticized the SEC’s past regulatory approach, arguing that its aggressive stance on crypto drove engineers out of the industry, discouraged innovation, and led to several projects being halted or never launched at all. “How many years of innovation were kicked down the road at the expense of Americans? We will never know,” he stated.
The Gemini co-founder warned that without consequences for regulatory overreach, similar actions could occur in the future. He emphasized that while thoughtful legislation can serve as a protective measure, there must also be internal accountability within regulatory agencies to deter such behavior.
To prevent future regulatory overreach, Cameron Winklevoss suggested three possible measures to hold the SEC accountable: financial reimbursement, dishonorable discharge of responsible officials, and a ban on individuals from holding positions within the agency.
“We will not rebuild trust and integrity in federal agencies unless there are serious consequences for bad faith actors,” Winklevoss further stated.
He expressed relief that the crypto industry is moving forward but cautioned that this is not “the end” of regulatory challenges. Instead, he described it as the beginning of efforts to ensure that similar actions do not occur again in the industry.
The SEC’s decision to close its investigation into Gemini follows a pattern of recent case dismissals. In the days prior, the agency also dropped investigations into OpenSea, Robinhood, and Uniswap, signaling a broader shift in its regulatory approach.
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Michaela has no crypto positions and does not hold any crypto assets. This article is provided for informational purposes only and should not be construed as financial advice. The Shib Magazine and The Shib Daily are the official media and publications of the Shiba Inu cryptocurrency project. Readers are encouraged to conduct their own research and consult with a qualified financial adviser before making any investment decisions.
