Catenaa, Tuesday, March 24, 2026- Gemini was hit with a class‑action lawsuit in New York this week, with investors alleging the crypto exchange misled shareholders about its business strategy before and after its 2025 initial public offering as the company’s stock plunged and losses mounted.
Filed Wednesday in the U.S. District Court for the Southern District of New York, the complaint claims Gemini and executives including Tyler and Cameron Winklevoss made false or incomplete statements in offering documents tied to its September 2025 IPO and later disclosures. The suit seeks damages for investors who purchased shares during the IPO through mid‑February 2026.
Context
Gemini’s stock debuted on the Nasdaq and closed at $32 on its first trading day. It has since fallen more than 80 %, ending Thursday at about $6.01, according to data compiled by The Block. The complaint contends that offering documents presented the exchange as a growing crypto platform focused on expanding its monthly transacting user base and international footprint. Plaintiffs allege the company failed to disclose a planned strategic overhaul that would shift its business model.
In early February, Gemini unveiled its “Gemini 2.0” strategy, emphasizing development of a prediction market product. The pivot also included plans to cut about 25 % of its workforce and exit key markets including the U.K., European Union and Australia — moves plaintiffs contend contradicted earlier expansion narratives and were not properly disclosed.
The lawsuit also notes departures of several top executives, including the chief financial officer, chief operating officer and chief legal officer, as signs of internal disruption. Gemini did not immediately respond to a request for comment from The Block.
Gemini’s latest financial disclosure showed mixed results. Fourth‑quarter revenue rose 39 % year‑over‑year to $60.3 million, but its net loss widened sharply to $140.8 million from $27 million a year earlier. For full‑year 2025, the exchange reported a net loss of $582.8 million, compared with a loss of $158.5 million in 2024.
Co‑founders Tyler and Cameron Winklevoss said in a shareholder letter that workforce reductions have reached roughly 30 % since the start of the year, reflecting broader cost pressures.
Implications
The lawsuit arrives as Gemini’s trading volume trails larger competitors. In February, the exchange recorded about $2.14 billion in monthly volume, far below Binance’s $334.86 billion and Coinbase’s $68.99 billion, according to The Block’s data.
Investors allege that the company’s pivot and disclosure practices undermined confidence and contributed to the stock’s steep decline, arguing that key strategic risks were not clearly communicated. If successful, the lawsuit could lead to significant financial exposure for the exchange and its leadership.
