A federal judge has rejected a joint attempt by Gemini and the Commodity Futures Trading Commission to vacate the exchange’s $5 million settlement and permanent injunction.
Judge Alvin Hellerstein ruled on October 15 that the parties had not shown the exceptional circumstances required to reopen the January 2025 consent order. The eight-page court decision leaves both the paid penalty and the injunction in place.
The original case alleged that Gemini made materially false or misleading statements during the CFTC’s evaluation of a proposed Bitcoin futures product. Gemini litigated for roughly three years before settling shortly before trial.
The CFTC later joined Gemini’s motion for relief, saying the case did not fit the agency’s revised enforcement priorities and would not have been brought under its current approach. Hellerstein found that a regulator’s changed policy judgment does not undo a final judgment based on facts available at settlement.
The decision also rejected Gemini’s claim that regulatory pressure made its consent involuntary. The court described the settlement as a calculated choice made with trial approaching.
TOKEN RECON ASSESSMENT
An agency can change its enforcement philosophy, but it cannot automatically erase a court judgment after the defendant has settled. The ruling limits the practical reach of regulatory reversals and gives future defendants another reason to treat consent orders as durable. Any appeal, rather than a new CFTC policy statement, is now the relevant route for changing the outcome.
Sources: U.S. District Court order, CFTC, The Block.
