NEW YORK, Oct. 17 -- A joint filing in the Gemini case this year described the exchange as "the victim of a sophisticated fraud scheme enabled by its own Chief Operating Officer." On Thursday a federal judge used that line against it, ruling that Gemini knew as much as early as August 2017 and still chose to settle with its eyes open.

U.S. District Judge Alvin K. Hellerstein's order, dated October 15, denied a joint request from Gemini and the Commodity Futures Trading Commission to vacate the consent order that fined the exchange $5 million in January 2025. The agency that sued Gemini in 2022 now says the case should not have been brought. The judge was not persuaded that a change of heart is a change in the law.

The ruling answers a q...