Gemini

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(Redirected from Gemini Dollar (GUSD))

Basics

  • Exchange established in 2014 by the Winklevoss twins
  • "First fully regulated Bitcoin & Ether exchange in NYC (We are a fully regulated, fully compliant, New York-based digital asset exchange. We are regulated by the New York State Department of Financial Services (NYSDFS) and held to the highest level of capital reserve requirements and banking compliance standards.)"
  • Has insurance coverage for the digital assets it holds in custody.
  • A fully regulated licensed US Bitcoin and Ether exchange. That means Gemini’s capital requirements and regulatory standards are similar to a bank. Also, all US dollar deposits are held at a FDIC-insured bank and the majority of digital currency is held in cold storage. Gemini trades in three currencies, US dollars, bitcoin, and ether, so the platform does not serve traders of the plethora of other cryptocurrencies. The exchange operates via a maker-taker fee schedule with discounts available for high volume traders. All deposits and withdrawals are free of charge. The platform is only fully available to customers in 42 US states, Canada, Hong Kong, Japan, Singapore, South Korea and the UK.
  • Dynamic fees
  • has announced (4-2019) full support of deposits and withdrawals for SegWit, becoming the first major exchange to add the 2017 Bitcoin upgrade

Token

"The Gemini dollar (GUSD) issued by Gemini Trust Company LLC is meant to provide tokens built on the Ethereum network according to ERC20 standards corresponding 1:1 with holdings of traditional fiat USD held at State Street Bank and Trust Company. Intended to provide creditworthiness and price stability that mimics the U.S Dollar, code within the GUSD contracts were audited by a firm specializing in information security research & development. To verify the necessary 1:1 peg, the deposit balance at the U.S. Bank is examined monthly by BPM, LLP an independently registered public accounting firm."

Nifty Gateway

  • Nifty Gateway, the online marketplace for crypto-collectibles (NFTs), announced (19-11-2019) that they have been acquired by Gemini.

Pro's and Con's

Pros

  • Security & Compliance, slick/minimalistic and user-friendly design, great analytics, high liquidity. Insurance coverage for the digital assets it holds in custody.

Cons

  • Had $900M worth of customer funds locked in Genesis, which halted withdrawals on 16-11-2022 due to FTX contagion. Gemini halted its own withdrawals the same day. According to creditor lists, it was $765M (20-1-2023).
  • Limited currencies, small community, average customer support, limited worldwide availability, no margin trading.
  • From Bankless (27-8-2020):

"A straightforward example of incentives gone wrong comes from stablecoin issuer Gemini ($GUSD). In January of 2019, as GUSD was near its all-time high, The Block wrote:  

To spur adoption, Gemini offered their Gemini dollar to some over-the-counter trading desks at a discount - meaning each $1 token could be bought for less than a dollar. However, traders spotted an arbitrage opportunity in the deal where they could buy the discounted GUSD and then exchange it for Paxos Standard, Paxos' stable coin, at the full dollar price - pocketing the difference.

As rebates dried up, so did GUSD’s market cap."

Audits / Compliance

"Gemini announced Thursday it completed an independent SOC 2 Type 2 examination conducted by consulting firm Deloitte, a year after it completed an SOC 2 Type 1 examination. Where the previous examination evaluated Gemini’s design and system control implementation, the Type 2 exam looks at operations across a period of time. The firm will be completing a SOC 2 Type 2 on an annual basis, Hussain said."

"Completed the SOC 1 Type 1 examination in March. The report, conducted by Deloitte, is an attestation that Gemini’s financial reporting obligations work at a given moment."

Team, Funding, Partners

Team

  • Yusuf Hussain, head of risk at Gemini
  • The Winklevoss Twins; co-founders. Cameron Winklevoss is no longer a director at Gemini Europe, according to a Companies House filing made on October 12, 2022.
  • Gemini hired a former Goldman Sachs executive to lead their Asia expansion. 
  • On June 2, 2022, the company said in a blog post it would be cutting approximately 10% of its workers, citing “turbulent market conditions that are likely to persist for some time.” They again fired another 7% (20-7-2022).

Funding

"Gemini today announced the launch of a $200,000 Bitcoin development fund. Called the Gemini Opportunity Fund, $150,000 of the money, in Bitcoin of course, will go straight to Brink, a London non-profit fellowship program to sponsor Bitcoin developers. The developers will work with John Newbery, Brink’s co-founder and executive director, and a Bitcoin Core contributor. Mike Schmidt, another Bitcoin core contributor. Square, the Human Rights Foundation and Kraken are among other donors. Kraken also donated $150,000. So far, the only fellow is Gloria Zhao, a Bitcoin Core contributor fresh from University of California, Berkeley, where she sat as president of its blockchain club."

Partners

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