Judge Denies Gemini and CFTC's Joint Bid to Erase $5 Million Settlement

Published October 16, 2026, 11:55 PKT. Based on the October 15, 2026 ruling by U.S. District Judge Alvin K. Hellerstein of the Southern District of New York, as reported by Bloomberg Law, and reporting from The Block, crypto.news, CryptoBriefing and CryptoTimes.

Gemini and the U.S. Commodity Futures Trading Commission finally agreed on something, and a federal judge rejected it. On October 15, 2026, U.S. District Judge Alvin K. Hellerstein in New York denied the joint motion by crypto exchange Gemini Trust and the CFTC to vacate a consent order the company signed in January 2025, Bloomberg Law reported. The order carries a $5 million civil penalty and a permanent injunction, and both remain in force after the ruling.

The $5 million order stays

The motion, filed jointly on May 28, 2026, asked the court to wipe out the January 2025 settlement under Rule 60(b) of the Federal Rules of Civil Procedure, the provision courts use when a party wants to undo a final judgment, according to crypto.news and CryptoTimes. Gemini and the agency argued the settlement "violated bedrock principles of fair enforcement," Bloomberg Law reported, and the CFTC said an internal review had found problems with the reliability of the evidence and the way the case was handled. The agency also said the case would not have been brought under its current enforcement standards, TradingView's account of the Bloomberg reporting noted.

Hellerstein was not persuaded. "Neither of these arguments provide sufficient grounds for relief," the judge wrote, Bloomberg Law reported, adding that the CFTC's present view that the case should never have been filed does not require the court to erase the judgment.

Three weeks before trial

The judge put the most weight on the timeline. Gemini settled the case voluntarily three weeks before it was scheduled to go to trial, after roughly three years of litigation, The Block reported. Hellerstein noted that the company knew about the internal CFTC issues it now cites, including a fraud scheme involving its former chief operating officer, before it signed the agreement, and that it "made the calculated decision to settle the case shortly before trial."

New material cannot rewrite that decision. The judge found that newly acquired knowledge of facts that already existed when the consent order was entered does not amount to a significant change in factual circumstances, The Block reported. Gemini's argument that it settled under regulatory pressure did not establish that its consent was involuntary, and post-settlement regret did not make continued enforcement of the order inequitable.

The injunction nobody could erase

The money was never the real fight. Gemini has already paid the $5 million penalty, and neither side asked for a refund if the order were vacated, crypto.news reported. What Gemini and the CFTC wanted removed were the order's continuing restrictions: the permanent injunction barring the exchange from making false or misleading statements to the CFTC, a prohibition that stays live after the ruling.

A 2022 case over 2017 statements

The enforcement action began in 2022, when the CFTC sued Gemini over statements the exchange made in 2017 during the agency's review of a proposed Bitcoin futures contract, according to TradingView's account of the Bloomberg reporting. The futures contract was designed to settle against prices from Gemini's own auction, and the agency's theory was that what Gemini told regulators about that setup did not match reality, CryptoBriefing reported.

Gemini settled in January 2025, two weeks before the new administration took office, Bloomberg Law noted. Since then the agency has reversed course on crypto enforcement, with the president pledging to make the United States the "crypto capital" of the world, but Hellerstein's ruling keeps the Gemini order standing regardless of the agency's changed philosophy.

This article is news reporting and is not investment advice.

Sources

• U.S. District Court for the Southern District of New York, Judge Alvin K. Hellerstein's October 15, 2026 ruling on the joint Gemini-CFTC motion to vacate, as reported by Bloomberg Law, primary source for the denial, the "neither of these arguments provide sufficient grounds for relief" finding, the May 2026 joint motion's argument that the settlement "violated bedrock principles of fair enforcement," and the judge's finding that regret over the settlement does not make continued enforcement inequitable
• Bloomberg Law, "Judge Rejects Gemini, CFTC Bid to Undo $5 Million Settlement", October 15, 2026, secondary source for the ruling, the internal CFTC probe findings, the agency's position that the case would not have been brought under current enforcement standards, and the $5 million penalty and permanent injunction remaining in place
• The Block, "US federal judge denies joint Gemini-CFTC bid to undo $5 million settlement", October 16, 2026, secondary source for the Rule 60(b) standard, the "calculated decision to settle the case shortly before trial" finding, the fraud scheme involving the former chief operating officer, and the ruling that newly acquired knowledge of pre-existing facts is not a significant change in circumstances
• crypto.news, "Gemini, CFTC lose bid to cancel $5 million penalty", October 15, 2026, secondary source for the joint motion, the already-paid penalty with no refund sought, and the injunction barring false or misleading statements to the regulator
• CryptoBriefing, "Judge refuses to let Gemini and CFTC undo $5 million settlement", October 15, 2026, secondary source for the 2022 suit background, the 2017 statements during the Bitcoin futures review, and the Gemini-auction settlement design
• CryptoTimes, "US Judge Rejects Gemini, CFTC Bid to Overturn $5M Settlement", October 16, 2026, secondary source for the May 28, 2026 joint motion filing and the three-weeks-before-trial timeline