The long-running legal fight between the U.S. Securities and Exchange Commission and crypto firms tied to the Gemini Earn program has officially come to an end.
Court records show that the SEC and the companies involved have jointly agreed to permanently dismiss the civil lawsuit connected to Gemini’s crypto lending arrangement with Genesis.
Key Takeaways
SEC permanently ends its case over the Gemini Earn program
Investor funds were fully recovered through the Genesis bankruptcy, with Gemini support
Genesis had already settled separately with the SEC for $21 million
The case is being dropped “with prejudice,” meaning the regulator cannot revive the same claims in the future, once a federal judge formally signs off on the filing.
The lawsuit centered on allegations that the Earn program amounted to the sale of unregistered securities. Under the program, customers of Gemini Trust Company were able to lend digital assets through Genesis Global Capital in exchange for yield. That structure came under scrutiny after Genesis collapsed amid the broader crypto credit crisis.
Regulatory Retreat After Investor Repayments
The SEC’s decision to walk away from the case follows major recoveries for affected users. Through Genesis’ bankruptcy process, Gemini Earn customers ultimately received a full, in-kind return of their crypto holdings in mid-2024. Gemini also committed up to $40 million to help ensure investors were made whole, a factor that appears to have weighed heavily in the regulator’s stance.
Genesis itself had already resolved its dispute with the SEC earlier, agreeing to pay a $21 million civil penalty. With investor losses addressed and a separate settlement in place, the agency signaled it was satisfied closing the remaining litigation.
Pause Under New Leadership
Notably, the case had been effectively dormant for months. The SEC paused proceedings in April 2024 while Mark Uyeda was serving as acting chair, amid a broader reassessment of several crypto enforcement actions. The latest court filing formalizes that pause into a full dismissal.
The original lawsuit was filed in January 2023, during a period when the SEC sharply escalated legal action against crypto firms. That wave of enforcement unfolded under the Biden administration, as regulators pursued lending, staking, and yield products they viewed as falling outside existing securities laws.
A Symbolic End to a Turbulent Chapter
While a judge’s final approval is still pending, the joint stipulation signals that one of the most prominent crypto lending cases from the post-FTX era is effectively over. For Gemini, led by the Winklevoss brothers, the dismissal removes a major legal overhang tied to its Earn product. More broadly, it underscores how bankruptcy resolutions and investor recoveries are reshaping the SEC’s approach to legacy crypto cases from the industry’s most volatile period.
