Former Gemini Trust Co Senior Executive under Criminal Investigation for Misleading Statements

02/14/2023 03:04 • Digital Disruptors • 77 views

On February 14, according to a court document, the former senior executive of Gemini Trust Co, a crypto exchange, was the subject of a criminal investigation that has now ended. The investigation was carried out around the company’s first launch of a US-related Bitcoin futures contract. The focus of this investigation is the core issue of a civil case filed by the United States Commodity Futures Trading Commission (CFTC) in June last year. CFTC accused Gemini of making false and misleading statements when answering questions about futures contracts linked to Bitcoin prices on Gemini’s digital asset trading platform from July to December 2017.

Gemini faces criminal investigation by the prosecution of the United States in the CFTC lawsuit

Analysis based on this information:

On February 14, a court document revealed that the former senior executive of Gemini Trust Co, a cryptocurrency exchange, was under criminal investigation that has now ended. This investigation was conducted around the company’s first launch of a US-related Bitcoin futures contract. The United States Commodity Futures Trading Commission (CFTC) had filed a civil case against Gemini Trust Co in June last year for making false and misleading statements while answering questions about futures contracts linked to Bitcoin prices on the company’s digital asset trading platform from July to December 2017.

The suspicion surrounding the former senior executive’s involvement in the criminal investigation leads us to suspect that he may have knowingly provided these false and misleading statements to deceive the authorities and the public about the company’s operations. Gemini Trust Co launched its first Bitcoin futures contract in December 2017, which was approved by the CFTC. However, the Commission alleged that the company’s executives had deceived them by claiming that the Gemini Exchange used a particular algorithm to determine the settlement price of Bitcoin futures contracts.

The settlement price, according to the CFTC, was calculated based on the volume-weighted average price of Bitcoin trades executed on several other cryptocurrency exchanges, while Gemini allegedly claimed that they used their internal algorithm to compute the settlement price. This discrepancy led to charges of false and misleading statements being filed against the company, which is now the subject of the criminal investigation involving the former senior executive.

In conclusion, the latest developments in the case between Gemini Trust Co and the CFTC suggest that the former senior executive of the crypto exchange may have deliberately provided misleading statements to the Commission. However, we must wait for more information to come to light before we can make a definitive conclusion. The use of false and misleading statements raises concerns about the trustworthiness of such cryptocurrency exchanges and regulatory cases against them.

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