SEC Requests 60-Day Delay in Gemini Trust’s Lawsuit Settlement Talks

• SEC seeks a 60-day delay to explore a resolution with Gemini Trust.
• Gemini Earn program accused of offering unregistered securities by SEC.
• Delay signals potential shift in SEC’s approach to crypto regulation.

The U.S Securities and Exchange Commission (SEC) filed a court request to postpone its Gemini Trust lawsuit for 60-days. The application, submitted on April 1 in the U.S. District Court for the Southern District of New York, aims to stop all deadlines. The requested delay creates time for both parties to determine whether they can settle the dispute.

SEC Lawsuit Against Gemini Trust

In January 2023 the SEC sued Gemini Trust and Genesis Global Capital for illegally obtaining billions through the Gemini Earn program. SEC officials claim that Gemini Earn involved the sale of unregistered securities. The SEC launched this legal procedure as part of a wider regulatory crackdown on crypto firms under the Biden administration.

Gemini Earn users could lend crypto assets and earn interests through the Genesis platform. The SEC initiated the legal action against the program because it violated securities laws because it did not register any securities. The legal problem worsened when Genesis faced financial troubles and filed for bankruptcy hence customers lost access to their funds.

Gemini initially reached a settlement with New York regulators which required them to return $2.18 billion to affected customers. Moreover, Genesis reached another settlement where the company agreed to pay $21 million in February 2024. However, the SEC continues its lawsuit against Gemini Trust and Genesis.

SEC Files A 60-Days Hiatus in Gemini Case

The SEC’s motion indicates a possible resolution to the lawsuit. The parties have stated that the  delay would save judicial expenses and serve the public interest. The 60-day hiatus allows both Gemini and the SEC to reach a settlement or explore alternative methods to resolve their dispute.

The SEC’s recent actions demonstrate a shift in its cryptocurrency regulation. Under the Trump administration there has been a trend of relaxed enforcement toward crypto firms. The SEC recently withdrew its lawsuits against crypto firms such as Coinbase, Uniswap and OpenSea which signals friendly policies for the crypto industry.

A settlement between Gemini and the SEC could improve clarity for U.S securities laws . However, a failure to reach an agreement could create legal precedents for regulation of the crypto sector in future.

If the court allows the delay, both parties must submit an official joint status report within 60 days. The outcome of these discussions could shape the future of Gemini and other crypto companies that face similar legal obstacles.