Gemini's SEC Lawsuit Concludes with Full Investor Compensation

The US Securities and Exchange Commission (SEC) has officially dropped its lawsuit against Gemini Trust Company, citing the complete recovery of investor funds as a pivotal factor. Initiated in response to alleged securities violations linked to Gemini's Earn program, the case has now concluded following a joint agreement between the SEC and Gemini, as reported by Reuters.

SEC Withdraws Case After Investor Compensation

The SEC's decision to withdraw the lawsuit stems from the full repayment of investors affected by the collapse of Genesis Global Capital, a key partner in the Earn program. According to court documents filed on January 23, 2026, the SEC recognized the 100% recovery of assets through the Genesis bankruptcy process as a rationale for dismissal. This outcome underscores the resolution of investor claims and reflects the SEC's discretionary judgment.

Background of the Legal Proceedings

In 2023, the SEC accused Gemini of unlawfully offering securities through its crypto lending platform. The case highlighted how investors had lent their assets to Genesis, which subsequently froze funds amid the 2022 crypto downturn. Despite surviving a motion to dismiss last year, the lawsuit has now been resolved following Gemini's settlement with New York regulators and Genesis's $21 million penalty to the SEC.

Gemini's legal victory coincides with other notable crypto lawsuit resolutions in 2026, including a class-action dismissal involving Mark Cuban and the Dallas Mavericks. At the time Genesis froze accounts, the Earn program held assets valued at $940 million. The Winklevoss Twins have since ensured 100% restitution to their clients.

This development is a milestone for Gemini, reflecting the ongoing evolution and regulatory scrutiny within the cryptocurrency industry.