Then came the reversal. In May 2026, the CFTC joined Gemini in seeking to vacate the settlement. Following an internal review, the agency concluded the lawsuit should never have been filed, citing concerns about a whistleblower’s credibility, questionable evidence and its own enforcement practices. Gemini argued that mounting legal expenses and the approaching trial had pressured it into settling. The company even agreed to let the government keep the $5 million if the order was overturned.
Judge Rejects the Government’s About-Face
Hellerstein wasn’t persuaded. Most of the concerns raised by the CFTC involved circumstances that existed before the settlement. Alongside this, the centralized exchange (CEX) and crypto firm Gemini voluntarily accepted the agreement after years of litigation. The judge also rejected the idea that a new administration’s enforcement priorities justified undoing a binding court order.
The ruling leaves Gemini subject to the original injunction, although the CFTC retains discretion over enforcement. The irony is difficult to miss. The government now questions its own prosecution, Gemini wants the settlement gone, and neither side can convince the court to erase it.