Crypto platform Gemini’s stock is down 80% from its IPO. That’s reviving takeover speculation
Crypto exchange Gemini is facing takeover speculation as its market valuation and trading volumes have significantly declined since its IPO. Analysts suggest that potential buyers are interested in Gemini's regulatory licenses and infrastructure rather than its shrinking exchange business.
Why it matters
The trend highlights how regulatory compliance is becoming a primary driver for M&A activity in the volatile cryptocurrency sector.
Lorenzo Valente, director of digital assets research at ARK Invest, argued in a post on X last month that Hyperliquid, the offshore perpetual-trading platform, should acquire Gemini and use it as a regulated U.S. gateway for perpetual futures and prediction markets, with the Winklevoss twins’ concentrated voting control potentially simplifying the deal.
While there is no indication that Hyperliquid is actively pursuing a deal to buy Gemini, Valente's proposal raises a broader question: What is Gemini's value proposition to a potential buyer if its regulatory infrastructure is worth more than its shrinking spot-exchange business?
Currently, the stock's market cap is $753 million, down from about $4 billion at its peak. Gemini’s second-quarter exchange revenue fell 38% from a year earlier to $12.5 million, while spot trading volume dropped 66% to $3.8 billion, and assets on the platform declined to $8.4 billion from $18.2 billion.
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