SEC Drops Investigation Into Gemini, No Enforcement Action to Follow
The U.S. Securities and Exchange Commission (SEC) announced the closure of investigations into the Gemini Crypto Exchange operated by Winklevoss Twins. According to a notice from Gemini co-founder Cameron Winklevoss, the SEC informed its legal team on Monday that the investigation was over and that the agency will not currently recommend any enforcement action, based on the information available.
The decision comes 699 days after the investigation begins, 277 days after the SEC issued a Wells notice, which demonstrates the potential of enforcement actions. Although this decision provides relief for Gemini, it must be noted that SEC notifications will not lower the company. The agency clarified that its conclusions are not final and further action may be taken in the future.
The investigation revolves around Gemini’s “money-making” program, which the SEC alleges involves providing unregistered securities through a partnership with Crypto Lending Firm Genesis Global Capital.
Long-term battle with SEC
Cameron Winklevoss entered social media in his statement to reflect on the long battle with the SEC and its impact on Gemini and the wider crypto ecosystem. He opened U (about huge legal fees incurred, totaling tens of millions of dollars, and wider economic losses caused by uncertainty caused by the SEC regulatory approach.
He lamented that while the SEC’s actions may be a protective measure, the agency’s actions have had a significant negative impact on U.S. innovation, leading crypto talent to seek opportunities in other departments.
But, he wrote: “So where do we go from here? For agencies like the SEC bullying, harassing and attacking the legitimate industry, and then deciding one day to just say we’re fine and walk away, it’s totally unacceptable. It will happen again unless the cost and price is paid for this behavior.”
Changing regulatory landscape
The SEC recently withdraws lawsuits against other major players in the cryptocurrency industry, including Coinbase, and an investigation into Opensea, Robinhood and Uniswap ends. The move increases the possibility that the SEC may take similar actions with other high-profile cases, including an ongoing legal battle involving Ripple Labs.
