The parent firm of the Gemini cryptocurrency exchange is preparing to enter the prediction market industry to create new revenue streams and address financial challenges.
According to thirteen public papers on the CFTC website, Gemini Space Station Inc. registered a corporation named “Gemini Titan” for the operation of a “designated contract market” and sought clearance with the U.S. Commodity Futures Trading Commission to operate a derivatives exchange in May.
Gemini sets for prediction markets
Gemini has been in talks to introduce registration-related items as soon as feasible. According to reports, the exchange plans to provide services directly rather than through agreements with other parties.
The action would place it in competition with Polymarket, which is set to reopen in the United States, and Kalshi, the only other operational CFTC-regulated event market. It coincides with a spike in activity in prediction markets, with weekly trade volume reaching an all-time high of $2 billion in the last week of October.
Last month, Trump Media and Technology Group Corp., the company that runs the streaming service Truth+, and the FinTech company Truth.Fi, and the social media platform Truth Social announced that it will enable prediction markets on Truth Social.
Steps ahead for Gemini
Gemini would probably have to function through a Designated Contract Market governed by the CFTC under the Commodity Exchange Act if it were to offer event contracts in the United States.
Also Read: Winklevoss Twins Gemini Exchange Pushes Valuation Target To $3.1 Billion Amid Upcoming IPO
In order to maintain fair and orderly markets, the certification mandates that the exchange adhere to 23 basic principles that encompass topics including financial integrity, market monitoring, governance requirements, and system protections.
Gemini’s entry into prediction markets coincides with the exchange’s operator’s issues with declining income, significant net losses, and dwindling customer engagement after becoming public in September.
The CFTC has loosened its formerly stringent attitude on prediction markets, indicating an openness to seeing them as cutting-edge frontiers fusing information and finance, amid an increasingly favourable regulatory environment for cryptocurrency.
Gemini’s IPO
According to Google Finance statistics, shares have dropped by almost 49% since the company’s mid-September IPO, closing at $16.29 on Tuesday. After being priced at $28 a share, the stock opened at $32 on its first trading day. Since then, its value has decreased by about half.
In a market where rivals like Coinbase and Robinhood have a larger retail presence, Gemini’s future development is limited since institutional clients currently account for more than 80% of its trading activity.
Also Read: Gemini Starts A Local Crypto Exchange In Australia After AUSTRAC Registration