The United States Securities and Exchange Commission (SEC) has officially ended its investigation into cryptocurrency exchange Gemini without filing any charges. The regulatory scrutiny lasted nearly two years, raising concerns over the impact of such prolonged investigations on the crypto industry.
The decision follows a series of withdrawals of similar investigations, signaling a shift in the SEC’s regulatory approach. This move has sparked speculation about whether the SEC might take a similar stance on the ongoing Ripple lawsuit involving XRP.
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Winklevoss Criticizes SEC’s Approach to Crypto Regulation
According to Cameron Winklevoss, co-founder of Gemini, the investigation caused significant financial and operational setbacks. He expressed frustration over the SEC’s decision to drop the case after 699 days, citing the extensive legal expenses and disruption to innovation in the industry.
Winklevoss stated that Gemini alone incurred tens of millions in legal fees and suffered from lost opportunities due to regulatory uncertainty.
The SEC had issued a Wells Notice to Gemini 277 days before closing the probe. Despite the investigation concluding without any enforcement action, Winklevoss argued that the damage had already been done.
He accused the agency of stifling innovation and discouraging entrepreneurs from entering the crypto sector. He further suggested that such actions have driven talent away from the U.S., forcing companies to relocate to jurisdictions with clearer regulatory frameworks.
SEC Withdraws Multiple Crypto Investigations, Ripple Case Under Scrutiny
The SEC has withdrawn several crypto-related investigations, including probes into Uniswap Labs, Robinhood Crypto, and OpenSea. It has also paused its lawsuit against the Tron Foundation and Justin Sun, signaling a potential shift in its enforcement strategy.
Some believe the agency is reassessing its aggressive approach to digital assets, while others argue political and legal pressures are driving these decisions.
This shift has raised speculation about the Ripple lawsuit, a landmark case regarding whether XRP is an unregistered security. A judge ruled that XRP sales on secondary markets do not qualify as securities transactions, granting Ripple a partial victory. Despite this, the SEC continues pursuing the case, creating regulatory uncertainty.
With mounting criticism over unclear regulations, many hope the Ripple case’s resolution will bring clarity. Whether the SEC persists or retreats, its decision will significantly impact how digital assets are regulated in the U.S.
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