The Winklevoss twins, owners of Gemini, have agreed to settle the lawsuit with the CFTC, accepting a $5 million fine. Gemini neither confirmed nor denied the allegations of misleading financial regulators.
Tyler and Cameron Winklevoss made a strong effort to support pro-crypto candidates in the recent election but have criticized the CFTC on many issues. Many industry players expect the CFTC to take over crypto regulation from the SEC, but the twins could complicate the effort.
The Winklevoss twins and CFTC reach an agreement
The Gemini Trust company founded by Cameron and Tyler Winklevoss was successful avoid a litigation with the CFTC. This lawsuit begin since 2022 when the CFTC sued Gemini for allegedly misrepresenting its methods to prevent Bitcoin price manipulation.
“After [CBOE] certified Gemini’s proposed futures contract as eligible for listing, the CFTC, pursuant to its legal authority, initiated a separate investigation. CFTC alleges that Gemini’s statements were false and misleading as to material matters, giving rise to this lawsuit,” the complaint said.
Before the deal was reached, the parties would have been in court just a day after President-elect Donald Trump took office. The twins have strongly supported him in the 2024 election and this could make the public dispute awkward.
In fact, Cameron and Tyler Winklevoss have recently attempted to influence cryptocurrency policy in ways other than the CFTC.
For example, they donated $1 million in November to a failed bid to unseat Senator Elizabeth Warren, a notorious anti-cryptocurrency activist. They also praised Elon Musk’s DOGE reforms.
While the legal wrangling may end with a settlement, the case has been going on for two years, so the Winklevoss twins may still feel uneasy.
In August, the twins criticized the CFTC for trying to limit prediction markets. Besides, before the election, they asked for clarification on who could be the next SEC Chairman.
However, after Trump won the Presidential election, some sections of the industry asked the CFTC to take over some of the responsibility for regulating cryptocurrencies from the SEC.
For obvious reasons, neither Tyler nor Cameron Winklevoss has publicly endorsed the CFTC as the primary regulator of cryptocurrencies. However, the new Senate Majority Leader has supported this goal, creating additional momentum. The entire event shows the cracks that can appear in a seemingly unified pro-cryptocurrency coalition.
This means that the pair have not made too many specific demands for the future of cryptocurrency regulation in the United States beyond the effort to get Trump into the White House. After the election, they called on prosecutors to investigate SBF’s political contributions but did not make many other specific demands.
Overall, the push to give the CFTC more regulatory power could move forward, but perhaps without the support of the Winklevoss twins.