Key Takeaways
- Gemini accuses the CFTC of mishandling a multi-year investigation sparked by a disgruntled former executive.
- The exchange says the probe, which began in 2017, was driven by internal politics and led to no evidence of consumer harm.
- Gemini supports CFTC reform efforts but warns real change will require serious self-examination within the agency.
Crypto exchange Gemini is calling out the U.S. Commodity Futures Trading Commission (CFTC), accusing the regulator of abusing its enforcement powers during a years-long investigation that began in 2017.
In a letter to the CFTC’s Inspector General , Gemini claimed the probe was based on misleading allegations from a disgruntled former executive. It resulted in a dragged-out, expensive legal battle, despite no consumer harm ever being proven.
Ex-COO Sparked a Costly Battle
The investigation was originally triggered by a whistleblower complaint from Gemini’s former Chief Operating Officer, Benjamin Small.
He accused the exchange of misleading regulators about its Bitcoin futures product and manipulating internal risk data.
However, Gemini says Small was fired for hiding a $7.45 million trading loss and retaliated by fabricating his claims. According to arbitration findings cited by the company, Small’s actions were self-serving and dishonest.
Despite this, the CFTC launched a formal probe that stretched on for years, culminating in a no-fault settlement with no enforcement action against any individual or company official.
“The DOE Staff was not motivated by a principled application of the law or desire to protect the commodities markets,” Gemini’s legal team wrote. “Rather, these lawyers were driven by a selfish desire to advance their careers by misusing their offices to obtain a high-profile ‘win’ against Gemini Trust.”
Gemini Backs Reform—but Says CFTC Must Look Inward
Gemini is now publicly aligning itself with calls for internal reform at the CFTC, echoing concerns raised by Acting Chair Caroline Pham, who has criticized the agency’s enforcement-first mindset.
The company said the case highlights a deeper issue—an agency culture that prioritizes big headlines and career wins over sound regulation or fair outcomes.
Notably, Gemini points out that the real perpetrators behind the original trading loss were never charged.
Instead, the agency spent years targeting a company that, it claims, did nothing wrong.
As Congress and the broader crypto industry push for regulatory clarity, Gemini says fixing the CFTC will take more than press releases—it’ll take introspection and accountability from within.
