Winklevoss Twins’ Exchange Sued by US Commodities Regulator

Alex Dovbnya

Things Get Worse For Popular Cryptocurrency Exchange Led By The Winklevoss Twins

The Commodity Futures Trading Commission (CFTC) has taken the Gemini cryptocurrency to court, alleging that the Winklevoss-led cryptocurrency exchange misled regulators about the nature of its Bitcoin futures contract, according to a report by Bloomberg.

Gemini allegedly made false statements about its activities during meetings with CFTC employees. The exchange allegedly lied about preventing market participants from entering into transactions with themselves. The regulator alleges that Gemini offered some participants discounts on the fees that could be misused to engage in self-trading.

Gretchen Lowe, acting director of enforcement for the CFTC, claims enforcement actions are intended to send “a strong signal” about the regulator’s determination to protect the integrity of the market surveillance process.

Chicago-based Cboe Global Markets announced the launch of Bitcoin futures in early December 2017. At the time, the price of the largest cryptocurrency was nearing the peak of the previous cycle.

The cash-settled contracts were based on Gemini’s auction price for Bitcoin.

The lawsuit, filed earlier today in Manhattan federal court, does not specify whether the attempt was related to that historic partnership.

In March 2019, Cboe shut down its Bitcoin futures, claiming it needed to reassess how it would approach the cryptocurrency space. The exchange’s exit was attributed to declining demand for cryptocurrencies.

Juthica Chou, head of over-the-counter options trading on the Kraken exchange, believes that Cboe has not delisted Bitcoin futures just for reasons of market demand.

Earlier today, Gemini also announced that it was laying off 10% of its workforce due to adverse market conditions.

It is unclear whether the shooting is related to the CFTC lawsuit.

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