Gemini co-founder and CEO Cameron Winklevoss tweeted on 2/26 that the U.S. Securities and Exchange Commission (SEC) has completed its investigation and, based on the information currently available, will not take enforcement action against Gemini. However, the SEC also emphasized that this does not mean Gemini is completely exonerated, and it may still take enforcement action based on the results of other investigations.
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ToggleSEC Previously Accused Gemini of Unregistered Securities Activities
On January 12, 2023, the SEC accused Gemini and the crypto lending platform Genesis Global Capital of offering unregistered securities through Gemini's "Earn" program, which allowed users to deposit cryptocurrencies and earn interest. However, after Genesis declared bankruptcy in 2022, the Earn program came under SEC scrutiny, leading to regulatory disputes with Gemini.
Winklevoss Says SEC Crackdown Has Severely Damaged the Industry
Regarding the SEC's decision to drop the investigation, Winklevoss stated that this cannot make up for the damage the SEC has caused to Gemini and the entire crypto industry. He criticized the SEC for forcing Gemini to pay millions of dollars in legal fees and causing billions of dollars in lost productivity, innovation, and development.
"Of course, Gemini is not the only victim. The SEC's actions towards other crypto firms, in general, have caused incalculable damage to the growth of the American economy," Winklevoss strongly stated.
SEC Suspends Investigations of Multiple Crypto Firms
Recently, the SEC not only ended its investigation into Gemini but also withdrew its lawsuit against Coinbase on 2/21, which had accused Coinbase of operating as an unregistered securities broker. On the same day, the SEC also closed its investigation into the Non-Fungible Token (NFT) trading platform OpenSea and withdrew the legal proceedings against the decentralized exchange Uniswap and the U.S. online broker Robinhood Crypto.
Winklevoss described this as a milestone in ending the "crypto war," but he believes the damage has been done, and many crypto projects and talents may choose to exit or avoid the industry due to "regulatory pressure."
Calls for Regulatory Reform to Prevent Political Pressure Recurrence
Winklevoss emphasized that the government should develop "more reasonable legislative regulations" in the future and establish a punishment mechanism for unnecessary investigations and unfounded enforcement actions. He suggested that SEC officials involved in these enforcement actions should be fired, banned from returning to the institution, and even required to compensate crypto firms for their legal expenses.
"Government agencies should not arbitrarily intimidate, harass, and suppress a legitimate industry, and then one day say 'never mind, we're not investigating anymore' and just walk away," Winklevoss criticized. "This storm may have passed quickly, but this is not the end, it's a new beginning. We need to ensure that this kind of situation will not happen again, not only to the crypto industry, but to any emerging technology industry in the future."
Risk Warning
Cryptocurrency investments carry a high degree of risk, and their prices may fluctuate dramatically. You may lose your entire principal. Please carefully evaluate the risks.
