The reason is old rubygems. So we need to remove ssl source to be able to update gem --system which includes rubygems and so on. after this we can feel free to get back to ssl source.
gem sources -r https://rubygems.org/ - to temporarily remove secure connection
gem sources -a http://rubygems.org/ - add insecure connection
gem update --system - now we're able to update rubygems without SSL
after updating rubygems do vice versa
gem sources -r http://rubygems.org/ - to remove insecure connection
gem sources -a https://rubygems.org/ - add secure connection
Now you're able to update gems using secure connection.