Gemini Crypto Exchange Sued by CFTC, Slashes 10% Workforce Amid Challenging Market

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Crypto Regulation
Gemini Crypto Exchange Sued by CFTC, Slashes 10% Workforce Amid Challenging Market

Gemini, a cryptocurrency currency exchange owned by the Winklevoss brothers was today sued by the Commodity Futures Trading Commission (CFTC) over misleading statements.

CFTC Sues Gemini Crypto Exchange

CFTC today sued Gemini, the US-based cryptocurrency exchange owned by Cameron and Tyler Winklevoss.

The regulator said Thursday that it had sued Gemini for “making false or misleading statements of material facts or omitting to state material facts to the CFTC in connection with the self-certification of a bitcoin futures product.”

CFTC added:

“According to the complaint, Gemini, directly and through the DCM, provided information to the CFTC concerning Gemini’s trading platform and the Gemini Bitcoin Auction, and certain statements and information conveyed or omitted by Gemini were false or misleading with respect to, among other things, facts relevant to understanding whether the proposed Bitcoin Futures Contract would be readily susceptible to manipulation. As alleged in the complaint, Gemini personnel knew or reasonably should have known that such statements were false or misleading.”

For the uninitiated, Cboe’s cash-settled bitcoin futures contracts use price data from Gemini since their launch way back in December 2017. However, the complaint by the CFTC does not exactly name Cboe.

Gemini Forced to Reduce Workforce

Besides the latest CFTC lawsuit against their name, Gemini is having a tough time in the current crypto bear market that continues to eat into the company’s treasury which held most of its reserves in crypto assets.

Earlier today, Gemini’s founders the Winklevoss brothers announced that the exchange has decided to slash 10 percent of its total workforce given the current less than convincing state of the digital assets market.

While the exchange did not disclose the exact number of employees it has laid off, the company’s LinkedIn page indicates that more than 1,000 people work with it. A modest estimate of the number of layoffs sits at around 100 employees.

It is also worth highlighting that this is the first time that Gemini has announced layoffs since its launch as an exchange in 2014. Gemini is far from being an outlier during the current bearish market phase where several companies are actively working toward cost-cutting to boost profits.

The official announcement by Gemini reads:

“This is where we are now, in the contraction phase that is settling into a period of stasis — what our industry refers to as ‘crypto winter.’ This has all been further compounded by the current macroeconomic and geopolitical turmoil. We are not alone.”

Adding:

“Every great company throughout history has faced similar challenges along the way and Gemini is no different. And as painful as this moment is, we ultimately see it as an opportunity to double-down on our strongest ideas and customer-centric products so that we may be the catalyst of innovation coming out of these leaner times that will help fuel the next cycle of crypto growth and adoption.”

Whether the current market downtrend will significantly impact Gemini’s plans to go public remains to be seen.

In recent news, crypto.news reported that Gemini had bagged the electronic money (e-money) license by the Irish Central Bank.

Aisshwarya Tiwari

Aisshwarya is currently working as the Chief Editor at crypto.news and holds more than 4 years of experience in the digital assets industry. He holds an undergraduate degree in Commerce with Honours and a post-graduate diploma in Liberal Studies. Before entering the crypto industry, Aisshwarya worked as an SAP Consultant for a global IT firm. He also cleared the CFA Level 1 exam before pivoting to the crypto industry due to its novel and exciting propositions.