The US Securities and Exchange Commission (SEC) and Gemini Trust Company submitted a status update in court, informing a federal court that they had achieved a “resolution in principle” regarding a securities case originating from a 2023 complaint.
In a Monday submission to the US District Court for the Southern District of New York (SDNY), the SEC and Gemini Trust indicated that, “pending review and approval” by the commission, both parties requested an indefinite stay of all litigation in the civil case.
The submission noted that both parties would provide another status report if the case remained unresolved by Dec. 15.
The securities case against Gemini Trust and Genesis Global Capital commenced with a complaint filed by the SEC in January 2023. The commission alleged that Genesis and Gemini “conducted an unregistered offer and sale of securities to US retail investors” from February 2021 to November 2022.
The tentative agreement likely represents one of the final phases in the resolution of the case against the two firms following the SEC and Genesis’s announcement of a $21 million settlement in 2024.
At that time, under acting SEC chair Mark Uyeda, the agency informed Gemini in February that it would not recommend further enforcement actions as part of a separate investigation into the company.
Related: Gemini (GEMI) stock surges in Nasdaq debut during crypto IPO boom
The securities case claimed that investors transferred assets to Genesis via Gemini’s Earn Program with the expectation of receiving interest. The SEC stated that both firms raised “billions of dollars’ worth of crypto assets, mainly from US retail investors,” without proper registration with the regulator.
“[I]nvestors were deprived of critical information regarding the Gemini Earn program that would have influenced their investment decisions,” asserted the January 2023 complaint. “Rather than providing investors with comprehensive information mandated by federal securities laws, the Defendants offered only selective and insufficient disclosures.”
Trump and Gemini: Partners in crypto policy?
Gemini co-founders Cameron and Tyler Winklevoss were both financial and personal backers of US President Donald Trump during his 2024 campaign and have maintained close connections with the White House throughout this year.
The twins were present for the signing of the GENIUS stablecoin bill and reportedly urged Trump to reconsider the nomination of Brian Quintenz as chair of the US Commodity Futures Trading Commission.
Prior to the August recess, the White House requested that a Senate committee postpone a hearing on Quintenz’s nomination, and as of Monday, no additional hearings had been scheduled.
Last week, Quintenz shared screenshots of messages exchanged between himself and the Winklevosses from July, indicating that they sought specific assurances regarding enforcement actions should his nomination proceed.
Gemini also launched its initial public offering on Friday, reportedly generating $425 million with 15.2 million shares.
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