Gemini Winklevoss asks for tripled legal costs after SEC dropped investigation
Cameron Winklevoss is the co-founder and CEO of Gemini. He has called on the US Securities and Exchange Commission, or SEC, to reimburse Gemini for its legal fees and remove officials from its closed investigation.
Winklevoss revealed on Feb. 26 that the SEC has officially dropped its investigation against Gemini, without filing any charges.
Later, the exchange confirmed that this decision was made almost two years after the inquiry started and nearly a year after receiving an Wells Notice.
The SEC’s decision aligns with its recent pattern of withdrawing cases against crypto firms. In the past week alone, the agency has abandoned investigations into OpenSea, Robinhood, and Uniswap and paused its lawsuit against Binance.
Slams SEC’s approach
Despite the SEC’s decision, Winklevoss condemned the agency’s actions, arguing that the prolonged investigation had significantly damaged the crypto industry and the US economy.
He estimated Gemini alone had incurred legal fees of tens and hundreds of millions and suffered lost productivity and innovation of hundreds of million.
According to him
“The SEC cost us tens of millions of dollars in legal bills alone and hundreds of millions in lost productivity, creativity, and innovation. Gemini, of course, is not the only crypto company. The SEC’s behavior in aggregate towards other crypto companies and projects cost orders of magnitude more and caused unquantifiable loss in economic growth for America.”
Winklevoss pointed out that the SEC’s aggressive enforcement approach discouraged engineers and entrepreneurs from entering crypto. He highlighted that some projects may have been abandoned, or even never started due to the hostile enforcement environment.
Winklevoss recommended that, to avoid such regulatory overreach by regulators, companies be reimbursed for triple their legal expenses if the investigations do not result in criminal charges. He recommended that SEC officials who took unjustified enforcement action be permanently barred.
He added that:
“Just like the SEC bars individuals from trading securities if they break the law, there should be a process that bars those like Gary Gensler who weaponize the law, as well those who participate in the weaponization, from ever being appointed to or hired by an agency again. Lifetime ban in this case.”
Winklevoss concluded without accountability from regulatory agencies, innovation and economic development in the United States would continue to be hindered.
He said:
“We will not rebuild trust and integrity in federal agencies unless there are serious consequences for bad faith actors. Operation Chokepoint did not stop with 1.0. Operation Chokepoint continued into 2.0 because bureaucrats were not held accountable enough for their actions in 1.0. And there will be a 3.0 unless there is a real, public reckoning for 2.0.”
