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The SEC dismissed its Gemini Earn lawsuit with prejudice.
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All Earn users recovered 100% of their assets in kind.
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The decision marks another retreat from aggressive crypto enforcement.
Three-Year Legal Battle Ends
The US Securities and Exchange Commission has formally dismissed its lawsuit against Gemini over the Gemini Earn lending program. The dismissal was filed with prejudice, meaning the agency cannot refile the same claims.
The SEC cited the full recovery of customer assets as a key reason for ending the case. Investors received 100% of their crypto holdings through the Genesis Global Capital bankruptcy process.
Background of the Case
The SEC sued Gemini in January 2023, alleging that Gemini Earn constituted an unregistered securities offering. The program froze withdrawals in late 2022, trapping roughly $940 million belonging to more than 300,000 users.
While a judge initially allowed the case to proceed, subsequent settlements and customer repayments cleared the path for dismissal.
A Shift in Regulatory Approach
The move adds to a growing list of dropped or settled crypto cases under SEC Chair Paul Atkins. Enforcement actions against Coinbase, Kraken, and Ripple have also been withdrawn or resolved.
The decision signals a broader shift away from regulation-by-enforcement and toward clearer rulemaking for digital assets.
