Gemini – the Winklevoss-owned cryptocurrency exchange – has commenced its third round of job cuts in under a year, dismissing another 10% of its workforce.
Cameron Winklevoss claims the layoff was motivated by a combination of macroeconomic pressure and “unprecedented fraud” within the crypto industry.
Gemini’s Shrinking Team
As reported by The Information on Monday, the outlet received an internal message from Winklevoss stating that he’d been left with “no choice” but to reduce headcount.
“It was our hope to avoid further reductions after this summer, however, persistent negative macroeconomic conditions and unprecedented fraud perpetuated by bad actors in our industry have left us with no other choice but to revise our outlook and further reduce headcount,” he said in the letter.
Data from Pitchbook shows that Gemini had 1000 staff as of November 2022, meaning roughly 100 people were likely laid off. The last cut took place in July with 7% of the company losing their jobs, after 10% were dismissed a month earlier.
They’re not alone in taking such drastic measures: Coinbase laid off another 950 employees earlier this month after shafting 18% of its workforce in June. CryptoCom also cut another 20% of employees two weeks ago.
Most firms cite macroeconomic factors as their primary pain point. Rising interest rates helped crater crypto asset prices in 2022, hurting exchanges, miners, and trading firms alike.
Gemini’s Legal Battles
Winklevoss has been particularly aggressive in calling out Barry Silbert – the CEO of DCG whose trading arm, Genesis, went officially bankrupt last week. Winklevoss claims that Silbert and the two firms misrepresented the state of their financials to Gemini, whose Earn program has its users’ funds now locked inside Genesis.
In regards to fraud, FTX’s former boss Sam Bankman-Fried has been widely accused and charged of much the same after his exchange collapsed in July. The Securities and Exchange Commission (SEC) has levied charges against him for defrauding his customers by funneling user funds to his trading desk, Alameda Research – to which he has pleaded not guilty.
Yet Gemini and Genesis are now both embroiled in their own trouble with the SEC, which alleges each offered unregistered securities to the retail investing public through Gemini Earn. Nexo, a rival crypto lending platform, has given up on servicing U.S. customers after numerous challenges from regulators along these same lines.