SEC agrees to dismiss Gemini lawsuit

Core Viewpoint - The SEC has dropped its lawsuit against the crypto exchange Gemini, following a joint filing with Gemini to dismiss a lawsuit related to the collapse of the Gemini Earn investment product [1][2]. Group 1: Lawsuit Dismissal - The SEC and Gemini jointly filed to dismiss a 2023 lawsuit concerning the Gemini Earn product, which involved customers loaning crypto assets to Genesis in exchange for interest [2]. - The SEC stated that since Gemini Earn investors received 100% of their crypto assets back through Genesis' bankruptcy, the dismissal of claims against Gemini is deemed appropriate [3]. Group 2: Background on Gemini Earn - The Gemini Earn product faced issues when Genesis paused withdrawals in late 2022 due to market volatility, resulting in investors being locked out of their funds for 18 months [2]. - Genesis subsequently filed for bankruptcy shortly after pausing withdrawals, impacting Gemini Earn investors [2]. Group 3: Regulatory Context - The Gemini case is part of a broader trend where the SEC has sought to dismiss several enforcement actions against crypto firms since the beginning of the second Trump administration, including cases against Binance, Kraken, Robinhood, and Coinbase [4]. - Reports indicate that nearly two-thirds of pending crypto lawsuits have seen dismissals, pauses, or reduced penalties since January 2025 [4]. Group 4: Previous Settlements - In 2024, Gemini settled with New York Attorney General Letitia James for $50 million, intended to compensate 230,000 investors allegedly defrauded by the Gemini Earn program [3].