Gillian Lynch, head of Gemini exchange Ireland and EU, has announced regulatory approvals to operate in Italy and Greece. The news is a relief at a time when the FTX contagion is spreading through the crypto industry.
Gemini is a cryptocurrency exchange established in 2014 by Cameron and Tyler Winklevoss, and the platform enables users to trade crypto at low fees. The Platform is the custodian of the Nifty Non-fungible token (NFT) marketplace.
While the update is good news, the platform has recently had troubles emanating from the liquidity crunch in the crypto industry.
Gemini exchange approval in Italy and Greece
The Gemini exchange was approved by Organimo Agenti E Mediatori (OAM) regulator and Hellenic Capital Markets Commission (HCMC).
The approvals gave the platform rights to become a virtual currency operator and custodial wallet provider in the two countries. Together with the electronic money institution authorization from Ireland, the platform will now be able to provide safe crypto services to customers in the two countries.
The exchange is gaining momentum in Europe despite strict regulations giving hope to other crypto platforms.
Strong regulatory compliance has always been a core tenet of Gemini’s ethos; we believe that the long-term success and integrity of crypto markets and companies depend on them. Most importantly, by working proactively with regulatory bodies worldwide, we can ensure that we continue to place regulatory compliance at the heart of our products.
Gillian Lynch
Gemini exchange is now available in 65 countries, with recent establishments in Denmark, Czechia, Cyprus, Croatia, Latvia, Ireland, Hungary, Sweden, Slovenia, Portugal, Romania, and Liechtenstein.
Service disruptions
While Lynch was high on their recent achievements, she did not mention Gemini’s recent troubles.
After FTX filed for bankruptcy protection on November 11, Gemini consequentially fell into major troubles on its Gemini earn lending platform. The platform provided investors with an 8% return on investment on their crypto deposits. The FTX contagion resulted in unprecedented withdrawals that exceeded their liquidity.
The service is still down at press time, but other operations like Gemini Credit Card are working as usual.
The exchange reportedly connected to the troubled firm Genesis Global Capital in which $700M of Gemini funds were locked.
Genesis Global Capital also cited being affected by the troubled 3 arrows capital, which impacted their liquidity and lending activities.
Other disruptions resulted from reports of high traffic. On November 28, 2017, the platform crashed for several hours displaying “504 gateway time-out”. Gemini commented that they had to scale challenges resulting in outages. Gemini reported improving on scalability.
Genesis Global Capital’s troubles
According to a report by Barrons, Genesis Global Capital is under scrutiny by regulators in the United States.
The firm received lots of attention after suspending withdrawals and origination of loans after the collapse of FTX. The firm lost about $175M from FTX, and despite receiving a bailout of $140M from its parent company, the firm is still struggling.
The Barrons report indicated that the Alabama Securities Commission was involved in the case. The commission would determine whether the firm persuaded residents to invest in digital assets without proper approval.
On 22 November, the New York Times reported that Genesis Global Capital had hired investment bank Moelis to explore options, including bankruptcy. The firm, however, denied intentions to do so.
With stakes running high and the crypto winter extending into 2023, there is no way of telling when the liquidity crunch in the crypto market will end. One thing remains for sure, the firms that make it out will come back stronger and more resilient.
