Winklevoss Twins' Crypto Exchange Gets Sued By CFTC Over Bitcoin Futures Product

The U.S. Commodity Futures Trading Commission (CFTC) is suing cryptocurrency exchange Gemini, owned by Cameron and Tyler Winklevoss, for “making false or misleading statements” to the regulator in 2017.

What Happened: According to a release from the regulator on Thursday, Gemini made false statements and omitted certain facts to the CFTC during the regulator’s evaluation of a potential self-certified Bitcoin BTC/USD futures contract.

In the complaint, the CFTC alleges that Gemini omitted facts and misled regulators to undermine their ability to understand how easily the proposed Bitcoin futures contract could be subject to price manipulation.

“Gemini personnel knew or reasonably should have known that such statements were false or misleading,” stated the complaint.

A deeper analysis of the complaint by The Block’s Frank Chaparro found that the CFTC alleges that Gemini lied about giving market makers rebates on its Gemini Bitcoin Auction trading platform. This price of Bitcoin on this platform was to be used as the reference price for the Bitcoin futures contract.

The complaint further alleges that Gemini misled the regulator with respect to liquidity and trading volumes on the platform.

“We have an eight-year track record of asking for permission, not forgiveness, and always doing the right thing. We look forward to definitively proving this in court,” said a Gemini spokesperson to The Block.

The lawsuit comes right after the crypto exchange announced that it plans to cut 10% of its staff in light of the market downturn.

“This is where we are now, in the contraction phase that is settling into a period of stasis — what our industry refers to as ‘crypto winter’,” Cameron and Tyler Winklevoss said in a note to employees seen by Bloomberg.

Price Action: Gemini’s stablecoin Gemini Dollar GUSD/USD shed $50 million from its market cap on Thursday. At press time, Bitcoin traded at $30,650, up 2.56% over 24 hours as per data from Benzinga Pro.

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Posted In: CryptocurrencyGovernmentNewsRegulationsMarketsCFTCGeminiWinklevoss Tiwns
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