The U.S. Securities and Exchange Commission (SEC) filed a stipulation with the New York federal court on July 23, voluntarily dismissing the civil action against Gemini Earn with prejudice — the case cannot be refiled. The regulator stated that judicial resources should focus on more severe violations, and since all investors had received 100% compensation, no victims remained.
From collapse to full recovery
Gemini Earn suspended withdrawals in November 2022 after Genesis faced a liquidity crisis. In 2023, the SEC charged Gemini and Genesis with offering unregistered securities. After Genesis completed bankruptcy restructuring, the parties reached an in-kind repayment agreement: investors who deposited 1 BTC received 1 BTC back, not the dollar value at the low point. Gemini co-founders Winklevoss brothers injected an additional $40 million to cover any shortfall, ensuring no second losses.
Regulatory pivot becomes clearer
Since Paul Atkins took over the SEC in 2025, crypto enforcement has shifted from "sue first, clarify later" to establishing clear rules. According to Harvard Law School Forum data, SEC crypto-related enforcement actions in 2025 dropped 60% year-over-year. Charges against Binance have also been adjusted, concentrating firepower on fraud and misappropriation rather than compliance technicalities for startups.
The Winklevoss brothers said in a brief statement: "We are glad this chapter is finally closed. Earn users have fully recovered their assets."
Most crypto bankruptcy cases liquidate at fiat prices, making Gemini's in-kind model rare. The SEC lost its victim base to continue the lawsuit. As long as platforms ensure asset safety and proper repayment, the industry can still see responsible exchanges.