Gemini Explores to Launch Global Crypto Derivatives Trading Platform

by Damian Chmiel
  • Coinbase is considering similar options.
  • Growing regulatory pressure from the SEC may be a reason.
Winklevoss twins
Bloomberg

Gemini, the cryptocurrency exchange owned by the Winklevoss twins, is examining possibilities to launch an international crypto derivatives trading platform, according to The Information report from Wednesday.

Gemini Reportedly Seeks to Open Overseas Derivatives Exchange

The new platform from Gemini would offer trading in perpetual futures. Derivatives of this type are banned in the United States for retail investors due to their somewhat risky nature. Making them available in another jurisdiction would allow Gemini to offer users a product with no expiration date and the possibility of high leverage.

Two weeks ago, Bloomberg reported that another major crypto exchange, Coinbase, was looking to take a similar step. The search for foreign locations to relocate some trading services came after the US Securities and Exchange Commission (SEC) stepped up and tightened its crackdown against the cryptocurrency sector.

It all started with the collapse of the FTX digital assets trading platform last November. It was followed by the closure of three banks linked to digital assets, Silvergate Bank, Signature Bank and Silicon Valley Bank, or the CFTC's lawsuit against Binance for violating the US derivatives regulations, among other things.

The Information cites people familiar with the matter and claims that the Gemini exchange has been contacting trading platforms in various places around the world over the past few months in search of a market maker to support the execution of operations outside the United States.

Third Round of Job Cuts in Gemini and Regulatory Pressure

Pressure from the SEC, which has led Kraken exchange to shut down its staking services in the US, has also hit the Winklevoss brothers' platform. In January, the regulator charged two feuding companies, Genesis Global Capital and Gemini Trust Company, for offering and selling crypto lending products under Gemini Earn, which the regulator alleged to be unregistered securities.

Gemini and its Co-Founders are already dealing with a class-action lawsuit filed by a pair of Gemini Earn investors who have leveled comparable allegations. The legal action contends that the exchange and its proprietors have engaged in fraudulent activities and breached the Exchange Act.

A few days later, news emerged that Genesis was close to declaring bankruptcy following the collapse of the FTX exchange, which negatively affected the entire industry. Although the decision has not been confirmed, the problems are visible to the naked eye, and Gemini has already carried out three rounds of job cuts since last June.

The first took place in June and affected 10% of the entire team, and the second in July and involved another 7% of the workforce. The most recent was conducted at the end of January when the company reduced a further 10% of its staff.

Saxo's Presents New Portal and JPX Gets into DeFi, read today’s news nuggets.

Gemini, the cryptocurrency exchange owned by the Winklevoss twins, is examining possibilities to launch an international crypto derivatives trading platform, according to The Information report from Wednesday.

Gemini Reportedly Seeks to Open Overseas Derivatives Exchange

The new platform from Gemini would offer trading in perpetual futures. Derivatives of this type are banned in the United States for retail investors due to their somewhat risky nature. Making them available in another jurisdiction would allow Gemini to offer users a product with no expiration date and the possibility of high leverage.

Two weeks ago, Bloomberg reported that another major crypto exchange, Coinbase, was looking to take a similar step. The search for foreign locations to relocate some trading services came after the US Securities and Exchange Commission (SEC) stepped up and tightened its crackdown against the cryptocurrency sector.

It all started with the collapse of the FTX digital assets trading platform last November. It was followed by the closure of three banks linked to digital assets, Silvergate Bank, Signature Bank and Silicon Valley Bank, or the CFTC's lawsuit against Binance for violating the US derivatives regulations, among other things.

The Information cites people familiar with the matter and claims that the Gemini exchange has been contacting trading platforms in various places around the world over the past few months in search of a market maker to support the execution of operations outside the United States.

Third Round of Job Cuts in Gemini and Regulatory Pressure

Pressure from the SEC, which has led Kraken exchange to shut down its staking services in the US, has also hit the Winklevoss brothers' platform. In January, the regulator charged two feuding companies, Genesis Global Capital and Gemini Trust Company, for offering and selling crypto lending products under Gemini Earn, which the regulator alleged to be unregistered securities.

Gemini and its Co-Founders are already dealing with a class-action lawsuit filed by a pair of Gemini Earn investors who have leveled comparable allegations. The legal action contends that the exchange and its proprietors have engaged in fraudulent activities and breached the Exchange Act.

A few days later, news emerged that Genesis was close to declaring bankruptcy following the collapse of the FTX exchange, which negatively affected the entire industry. Although the decision has not been confirmed, the problems are visible to the naked eye, and Gemini has already carried out three rounds of job cuts since last June.

The first took place in June and affected 10% of the entire team, and the second in July and involved another 7% of the workforce. The most recent was conducted at the end of January when the company reduced a further 10% of its staff.

Saxo's Presents New Portal and JPX Gets into DeFi, read today’s news nuggets.

About the Author: Damian Chmiel
Damian Chmiel
  • 1456 Articles
  • 29 Followers
About the Author: Damian Chmiel
Damian's adventure with financial markets began at the Cracow University of Economics, where he obtained his MA in finance and accounting. Starting from the retail trader perspective, he collaborated with brokerage houses and financial portals in Poland as an independent editor and content manager. His adventure with Finance Magnates began in 2016, where he is working as a business intelligence analyst.
  • 1456 Articles
  • 29 Followers

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