Winklevoss-Led Gemini Reaches 'Resolution in Principle' With SEC Over $900 Million Unregistered Crypto Lending Program

Gemini Moves To End SEC Clash As US Crypto Oversight Retreats

Gemini and the US Securities and Exchange Commission have reached what both sides call “a resolution in principle” to end a long-running dispute over the exchange’s Gemini Earn lending product.

In a joint filing to US District Judge Edgardo Ramos in Manhattan, lawyers requested that all court deadlines be paused until 15 December while they complete the paperwork.

The filing stated,

“The parties in this case have reached a resolution in principle that would completely resolve this litigation, subject to review and approval by the Commission.”

How The Dispute Began

The conflict traces back to January 2023 when the SEC accused Gemini and its partner Genesis Global Capital of offering unregistered securities through the Gemini Earn programme.

Launched in 2021, the service let customers lend crypto assets to Genesis in exchange for yields of up to 7.4% APY, while Gemini collected fees of as much as 4.29%.

Trouble erupted when Genesis halted withdrawals in November 2022 and later filed for bankruptcy, leaving around $900 million in customer funds from roughly 340,000 Gemini Earn users locked up.

Genesis has since agreed to a $21 million fine without admitting wrongdoing, while Gemini has consistently denied the SEC’s allegations.

IPO Success Adds New Momentum

The settlement talks follow a significant milestone for Gemini.

Just four days earlier, the company completed an initial public offering that raised $425 million and valued the New York-based exchange at about $3.3 billion.

Shares closed at $32.52, a 16% gain over the $28 IPO price, giving Gemini a timely financial and reputational lift as it works to close the regulatory chapter.

Changing Climate For US Crypto Enforcement

The agreement lands as federal crypto enforcement appears to be easing under President Donald Trump’s administration.

The SEC recently dropped an unrelated probe into Gemini, and other high-profile cases have slowed.

CFTC Chair nominee Brian Quintenz even alleged that Gemini co-founder Tyler Winklevoss lobbied against his confirmation, though the SEC settlement is not directly tied to those claims.

Possible Blueprint For Future Crypto Products

Legal experts say the final terms, once approved, could influence how yield-generating crypto products are structured.

Questions remain over whether such services will need to register as securities offerings or meet specific disclosure requirements.

The Ripple case showed similar “in principle” settlements can linger, so Gemini’s legal resolution might still take months to formalise.

A Settlement That Raises Bigger Questions

Coinlive believes this deal reflects more than a single company’s legal victory.

It signals how regulatory momentum in the United States is shifting at a time when crypto markets are pushing for mainstream acceptance.

For Gemini, the settlement may help restore credibility after the Earn debacle, yet the unresolved customer repayments highlight the limits of enforcement actions when investor funds are already lost.

If US regulators continue to ease pressure, companies may feel emboldened to test the line between innovation and compliance, leaving everyday investors to bear the greatest risk.