GEMI Finds Its Footing After SEC Drops Lawsuit, Ending Legal Cloud Over Gemini Earn

Gemini's legal troubles with the SEC are officially over, with no penalties imposed, following settlements and customer recoveries.

• The SEC formally dismissed its Gemini Earn lawsuit on Friday.
• Gemini-linked equity GEMI fell 3.48% on Friday and is down more than 7% over the past five sessions despite the legal win.
• The dismissal follows full customer recoveries through Genesis’ bankruptcy and does not signal a pause in broader crypto enforcement.

The U.S. The Securities and Exchange Commission formally dropped its lawsuit against Gemini Trust Company without penalty,  removing a long-standing legal overhang tied to the Gemini Earn program.

On Friday, the U.S. Securities and Exchange Commission (SEC) and Gemini Trust Company jointly filed a stipulation to dismiss the regulator’s civil enforcement action in the Southern District of New York, formally ending the case without penalties against Gemini. 

The lawsuit,  originally filed in January 2023, centered on allegations that Gemini Earn involved the unregistered offer and sale of securities through its partnership with Genesis Global Capital.

Despite the legal resolution, Gemini (GEMI) closed at $9.72 on Friday, down 3.48%, and is down more than 7% over the past five trading days. GEMI was trading at $9.73 in pre-market trading on Monday. On Stocktwits, retail sentiment around Gemini remained in ‘bearish’ territory, as chatter around it remained in ‘normal’ levels over the past day. 

SEC Case Formally Closed

According to the joint filing, the SEC agreed to dismiss all claims against Gemini with prejudice, meaning the agency cannot refile the same allegations based on the conduct covered in the complaint. The dismissal followed the return of 100% of digital assets owed to Gemini Earn customers through the Genesis bankruptcy process, as well as earlier settlements with New York state regulators.

Genesis previously agreed to pay a $21 million civil penalty to resolve the SEC’s claims against it, while Gemini neither admitted nor denied wrongdoing in related state-level settlements. The filing also notes that Gemini contributed up to $40 million to help fund customer recoveries through the bankruptcy process.

Despite the legal resolution, GEMI’s share price reaction has been muted, suggesting investors are still weighing broader regulatory risk, business recovery prospects, and sector-wide sentiment.

The SEC noted in the filing that the dismissal does not reflect its position on other crypto-related cases, underscoring that enforcement activity across the sector remains active even as this chapter closes.

For updates and corrections, email newsroom[at]stocktwits[dot]com.<