Gemini has undergone two rounds of layoffs in the past year in an effort to reduce operational costs but has managed to remain afloat during the crypto winter.
Cash Flow Issues
Gemini’s financials were hit hard by a dispute with Genesis, which locked up roughly $900 million in customer funds. Furthermore, the SEC sued both platforms over perceived securities law violations, citing Gemini’s partnership with Genesis’s Earn product. Gemini also saw the departure of its COO, Noah Perlman, who became Binance’s Chief Compliance Officer.
The Winklevoss twins attempted informal fundraising, which failed to garner investments, leading to them offering $100 million from their personal fortune for operational expenses, although this is not part of the Genesis bailout fund.
VC Funding Drought
The inability to secure further funding for a company that raised $400 million just two years ago highlights the uncertainty among VC investors when it comes to blockchain-based companies. Investment in these firms over the past quarter has amounted to $2.4 billion, significantly less than the previous year’s figure, which saw an 80% decline.
Gemini’s decision to self-fund may encourage other VC investors to support the trading platform until the economic climate improves, as mass-funding options are dwindling rapidly. Neither Gemini nor the Winklevoss twins have responded to requests for comment.