Crypto Drama: Gemini vs. CFTC – A Tale of Whistleblowers and Career Climbers!

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Ah, the illustrious Gemini Trust, a beacon of virtue in the murky waters of cryptocurrency, has boldly proclaimed that the Commodity Futures Trading Commission (CFTC) is merely a band of careerist litigators, driven by a “selfish desire” to advance their own ambitions! What a scandal! 😲

In a letter, which one can only imagine was penned with great fervor, to the esteemed CFTC Inspector General Christopher Skinner, Gemini alleged that the agency’s Division of Enforcement lawyers relied on a rather dubious whistleblower report to launch their attack. Oh, the audacity! 🤦‍♂️

“The DOE Staff, in their infinite wisdom, selectively and unfairly weaponized the Commodity Exchange Act,” the lawyers for the exchange lamented, as if they were characters in a tragicomedy. “They brought forth dubious false statements charges against our noble Gemini!”

In June 2022, the CFTC, in a fit of righteous indignation, sued Gemini, claiming it had made false or misleading statements back in 2017. This was during the agency’s grand evaluation of whether a Bitcoin futures contract, which Gemini wished to launch, was susceptible to manipulation. Oh, the irony! 💰

Gemini, in a moment of sheer desperation, paid a $5 million fine to settle the CFTC’s claims in January, all while maintaining a dignified silence—neither admitting nor denying the agency’s findings. “We had no other choice!” they cried, as if caught in a web of their own making.

“False whistleblower report” used for lawsuit

Gemini further claimed that the DOE’s investigation was built upon a false whistleblower report from 2017, courtesy of their former operating chief, Benjamin Small. Ah, the plot thickens! Small, it seems, was on a “malicious campaign” against the exchange after being unceremoniously fired. How very dramatic! 🎭

Small was dismissed for allegedly attempting to conceal losses from a “multi-million dollar rebate fraud.” The exchange alleged that this involved a motley crew of characters, including Hashtech LLC and its executives, who were apparently up to no good. What a tangled web we weave! 🕸️

Gemini accused these companies of coordinating their trading to exploit special fee structures and earn substantial rebates, all while Small, the then-operating chief, was in on the scheme. A classic case of “you scratch my back, I’ll scratch yours,” leading to his downfall at the hands of the Winklevoss twins! 😅

Small told CFTC Bitcoin contract could be manipulated

In a twist of fate, Small’s dismissal prompted him to blow the whistle to the CFTC, claiming that Gemini had failed to disclose critical information regarding the susceptibility of its Bitcoin futures contract to manipulation. Oh, the irony of it all! 🔍

The exchange lamented that CFTC litigators “immediately and unquestioningly” embraced Small’s claims, launching an investigation into Gemini in 2018. How convenient! They claimed their Bitcoin futures contract “operated orderly for 19 months,” with nary an allegation of manipulation during that time. Quite the record! 📈

CFTC needs “long-term commitment” to overhaul DOE

Gemini, in a moment of rare candor, stated that CFTC acting chair Caroline Pham is “taking proactive steps to fix” the Division of Enforcement. They even referenced her May 2024 statement about “dubious enforcement actions.” How noble of her! 🙌

“This transformation will require serious introspection and a long-term commitment from the agency as a whole,” Gemini declared, as if they were offering sage advice to a wayward child. “We are willing to help in whatever capacity you deem helpful!”

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2025-06-17 16:20