Potential Resolution in SEC vs. Gemini Lawsuit
A significant development might be on the horizon in the ongoing legal battle between the U.S. Securities and Exchange Commission (SEC) and the cryptocurrency exchange Gemini regarding its Earn product. On Tuesday, both parties submitted a joint request to the U.S. District Court for the Southern District of New York, seeking a 60-day pause in proceedings as they explore the possibility of a resolution.
The SEC initiated legal action against Gemini in January 2023, claiming that the Gemini Earn product, which allows users to earn interest on their cryptocurrency holdings, was an unregistered securities offering. This lawsuit also implicated Genesis Global Capital, a lending partner of Gemini. In March 2024, Genesis reached a settlement of $21 million, resolving its involvement in the case and addressing its obligations stemming from the program.
Interestingly, since former President Donald Trump returned to office and appointed Mark Uyeda as the acting SEC chair, the regulatory body has taken a more cautious approach. The SEC has halted or dropped more than a dozen enforcement actions related to cryptocurrency, indicating a reassessment of how existing securities laws apply to digital assets. This shift could potentially influence the outcome of the ongoing case between the SEC and Gemini.
