Crypto exchange Gemini lays off 10% of workforce

Tyler Winklevoss and Cameron Winklevoss (LR), the co-founders of crypto exchange Gemini, on stage at the Bitcoin 2021 Convention in Miami, Florida.

Joe Raedle | Getty Images

Crypto exchange Gemini will reduce its headcount by 10%, a spokesperson told CNBC on Monday.

It is at least the third round of cuts in less than a year for Gemini, which was co-founded by twins Cameron and Tyler Winklevoss and, unlike many of its peers, is subject to banking regulation in New York.

Gemini had 1,000 employees as of November 2022, according to PitchBook data, suggesting about 100 people lost their positions. TechCrunch reported that Gemini had previously cut its headcount by 7% in July 2022, following a 10% cut a month earlier.

Other crypto firms such as Crypto.com, Coinbase, Kraken and Genesis have eliminated positions since November 11, the day Sam Bankman-Fried’s crypto exchange FTX filed for bankruptcy. In early January, Coinbase cut 20% of its workforce in a second major round of layoffs in an effort to preserve cash during the crypto market downturn.

“It was our hope to avoid further reductions beyond this summer, but persistent negative macroeconomic conditions and unprecedented fraud perpetuated by bad actors in our industry have left us with no choice but to revise our outlook and further reduce headcount,” wrote Cameron Winklevoss in an internal message obtained by The Information.

Gemini has endured a battle for customer funds in recent weeks. The exchange is also facing a legal battle with the Securities and Exchange Commission over an allegedly unregistered offer and sale of securities in connection with its partnership with Barry Silbert’s bankrupt company, Genesis.

Gemini has been involved in an intense feud with Silbert’s Genesis Trading, a crypto-lending firm that generated rich returns for Gemini clients through Gemini’s high-yield lending product, which is known as Gemini Earn.

The relationship soured when FTX filed for bankruptcy. Genesis then froze lending and redemptions shortly thereafter, leaving Gemini customers short an estimated $900 million. The string of failures also forced the Gemini Earn product to quickly follow suit with its own temporary suspension.

In the months since the Earn product was discontinued, Gemini’s 340,000 customers have grown increasingly frustrated. Some have joined together in a class action against the exchange.

Genesis filed for bankruptcy protection on January 19. The filing lists the 50 largest unsecured creditors, with Gemini topping the list with $765.9 million — more than $300 million higher than the next creditor.