SEC Drops Gemini Probe but Leaves the Door Open for Future Actions

• The SEC closed its probe into Gemini, adding to a trend of crypto firms escaping immediate regulatory action.
• Cameron Winklevoss criticized the SEC for financial and operational damages, urging reforms and accountability.
• Gensler’s exit and Trump’s return may shift U.S. crypto regulations, bringing relief but also uncertainty.

The United States Securities and Exchange Commission (SEC) has completed its investigation into the crypto exchange Gemini, according to Watcher Guru on X. On February 26, Gemini co-founder Cameron Winklevoss shared the notice, which confirmed that the investigation was complete. The SEC stated it would not recommend enforcement action on the current facts. However, the agency clarified that this is not equivalent to an exoneration. Future actions cannot be eliminated, depending on further findings.

SEC’s Aggressive Stance and Its Impact on Crypto Firms

On January 12, 2023, Gemini and Genesis Global Capital were first charged by the SEC. They were accused by the regulator of using the “Earn” program to offer unregistered securities. During the time of former SEC Chair Gary Gensler, this action was a component of a larger assault on cryptocurrency companies.

The choice to discontinue the Gemini probe, however, contributes to an expanding pattern. Cases against Coinbase, OpenSea, Uniswap Labs, and Robinhood Crypto were recently closed by the SEC. These rulings provide crypto companies with short-term respite and signal a change in regulatory monitoring.

Winklevoss expressed frustration, stating that the SEC’s actions caused significant financial and operational damage. He highlighted legal costs and lost productivity as major setbacks. Moreover, he argued that regulatory pressure stifled innovation and deterred talent from entering the industry.

Future of Crypto Regulation and the Path Forward

Besides Gemini, several other firms faced similar investigations. Coinbase and OpenSea had their cases closed on February 21, signaling potential regulatory softening. Nevertheless, Winklevoss stressed that these closures do not undo the harm caused by previous enforcement actions.

Additionally, he called for meaningful legislative reforms to prevent future regulatory overreach. He suggested that SEC staff involved in such investigations should face consequences. Moreover, affected crypto firms should receive compensation for unwarranted legal costs.

Gensler, known for his strict crypto policies,  resigned on January 20, 2025. His departure coincided with Donald Trump’s second presidential term. Trump, a vocal critic of Gensler’s approach, had pledged to remove him from office.