SEC Drops Gemini Probe After 699 Days: Winklevoss Slams "Unquantifiable Loss"

The Securities and Exchange Commission (SEC) has concluded its 699-day investigation into cryptocurrency exchange Gemini without filing any charges. The probe was terminated on Monday, with the SEC informing Gemini's legal team of its decision.

Cameron Winklevoss, co-founder and president of Gemini, expressed frustration rather than relief upon learning of the investigation's closure. He criticized the SEC for the significant financial burden imposed on his company, estimating that legal bills alone amounted to tens of millions of dollars, with hundreds of millions more lost in productivity, creativity, and innovation.

Winklevoss argued that the SEC's actions against crypto companies have resulted in "unquantifiable loss in economic growth for America." He called for consequences for both the SEC and individual staff members involved in the Gemini probe, suggesting that regulatory agencies should reimburse defendants for three times their legal costs when investigations are dropped.

The SEC's decision to close the Gemini investigation follows a series of similar moves by the agency. In recent months, the SEC has dropped probes into Uniswap Labs, Robinhood Crypto, and OpenSea. The agency has also paused litigation against the Tron Foundation, Coinbase, and Binance.

These developments suggest a shift in the SEC's approach to cryptocurrency regulation under acting SEC chair Mark Uyeda. The recent regulatory retreat follows a period of aggressive enforcement under former SEC Chair Gary Gensler, during which the agency pursued numerous actions against crypto companies.

Gemini previously reached a settlement with the SEC in March 2023, agreeing to pay $21 million in fines related to its Gemini Earn program. The recently dropped investigation was separate from this earlier settlement.

Industry experts have differing opinions on the SEC's recent moves. Some see them as signaling a more cooperative approach to regulation, while others remain skeptical about the agency's long-term intentions toward cryptocurrency businesses.

Winklevoss questioned the impact of the SEC's actions on innovation, stating, "How many years of innovation were kicked down the road at the expense of Americans? We will never know."