Gemini, the cryptocurrency exchange co-founded by Tyler and Cameron Winklevoss, has reportedly dipped into their own pockets to fund the business amid the current crypto market downturn. According to a Bloomberg report published on April 10, the twins have personally loaned $100 million to the exchange, following failed attempts to secure funding from outside investors.
Gemini Exchange Faces Increased Regulatory Scrutiny from SEC and New York’s DFS
This news comes as Gemini faces increased regulatory scrutiny. In January of this year, the U.S. Securities and Exchange Commission (SEC) charged Gemini, along with Genesis Global Capital, for offering unregistered securities through the exchange’s Earn program.
Furthermore, New York’s Department of Financial Services has reportedly launched an investigation into the exchange after several Gemini users claimed that assets in their Earn accounts had been given FDIC protection.
In response to the charges, Tyler Winklevoss accused the SEC of issuing a “manufactured parking ticket.” He claimed that Gemini staff had been in talks with the regulator for over a year prior to its enforcement action. The statement echoes that of Coinbase, a crypto exchange that also received a Wells notice from the SEC.
Coinbase’s chief legal officer said that personnel had met with SEC representatives “more than 30 times over nine months” before receiving the notice.
Gemini is known for its strict compliance standards and has received regulatory approval in multiple jurisdictions. However, the current scrutiny highlights the challenges that crypto businesses face as they try to navigate a rapidly-evolving regulatory landscape.
