The Securities and Exchange Commission (SEC) and cryptocurrency exchange Gemini have jointly requested a 60-day pause in their ongoing legal battle to explore a potential resolution.
In a motion filed on April 1 in Manhattan federal court, attorneys for both parties asked to suspend all deadlines related to the SEC's January 2023 lawsuit against Gemini's crypto lending program. The filing indicates the pause would allow time to discuss a possible settlement, though specific terms were not disclosed.
The original lawsuit alleged that Gemini, run by twins Cameron and Tyler Winklevoss, failed to properly register their Gemini Earn program before offering it to retail investors. The program allowed customers to lend crypto assets to Genesis Global Capital for interest payments, with Gemini collecting fees up to 4.29% for facilitating transactions.
Genesis, which held $900 million from approximately 340,000 Gemini Earn customers, halted withdrawals in November 2022 following FTX's collapse and later filed for bankruptcy. In February 2024, Genesis agreed to pay a $21 million fine to settle its portion of the case.
The joint request comes amid broader changes in crypto regulation under the current administration. The SEC has recently dropped several high-profile cases against crypto companies and closed investigations into multiple firms' operations.
If the court grants the motion, both parties have proposed submitting a joint status report within the 60-day period. The filing suggests that reaching a resolution would benefit both the court and public interest by conserving judicial resources.
Neither Gemini nor SEC representatives provided additional comments on the proposed pause or potential settlement terms.