Policy Background and Key Developments
On March 9, 2025, Gemini, a cryptocurrency exchange founded by the Winklevoss twins, secretly submitted an IPO application to the U.S. SEC and chose Goldman Sachs and Citigroup as lead underwriters. This IPO is seen as a crucial step for the crypto industry’s transition to mainstream capital markets, and if successful, it will be another milestone following Coinbase’s listing in 2021. Gemini intends to raise funds through the IPO to expand its global business and alleviate financial pressures caused by previous regulatory lawsuits and user compensation obligations.
Founded in 2014 with compliance as its core positioning, Gemini has faced challenges in recent years, notably due to the collapse of its Gemini Earn product. In 2023, its partner, Genesis Global Capital, suspended withdrawals amid a liquidity crisis, forcing Gemini to reimburse users a total of USD 1.1 billion. In February 2025, Gemini reached a settlement with New York regulators and committed to phased compensation, thereby clearing some obstacles for its IPO.
Strategic Motives and Compliance Challenges
Gemini’s decision to pursue an IPO at this time is driven by several strategic considerations:
- A shift in the regulatory environment is a core driver, as Trump’s crypto-friendly policies (such as promoting state-level reserve bills and opposing CBDCs) have created favorable conditions for the industry.
- The market valuation performance following Coinbase’s listing (with a current price-to-sales ratio of about 3.5x) provides a benchmark for Gemini, with its IPO valuation expected to fall between USD 8–12 billion.
- Pending legal disputes also play a role: the SEC has accused the Gemini Earn program of engaging in illegal securities issuance; a lost lawsuit could result in fines of several hundred million dollars.
- Gemini faces significant cash flow pressures, needing to complete USD 1.1 billion in user reimbursements within 2025. Market competition is also severe, with Gemini’s current market share at only 0.13%, far below Binance (52%) and Coinbase (11%), necessitating differentiation through compliant derivatives and other services.
Market Impact and Industry Ripple Effects
If Gemini successfully lists, it could trigger several chain reactions. First, an IPO wave among crypto companies may accelerate, as exchanges such as Kraken and Bullish Global are already preparing for listings; Gemini’s case will provide a compliance template. Secondly, traditional financial institutions participating in the underwriting (e.g., Goldman Sachs and Citigroup) might attract more traditional capital into the market, fueling expectations for crypto ETF approvals. Additionally, Gemini’s listing could serve as a valuation benchmark for exchange tokens (like JuCoin’s JU), verifying the viability of token economic models.
Currently, market reactions are relatively cautious. Despite Bitcoin’s price stabilizing at around USD 88,000 following the news, trading volume for Gemini’s stablecoin GUSD has not increased significantly, reflecting a wait-and-see sentiment among investors. Institutional investors are more focused on the SEC’s review progress of the IPO than on short-term price fluctuations.
Future Outlook and Potential Variables
Gemini’s IPO process will face multiple tests. In Q2 2025, the SEC is expected to provide feedback on the application, making it crucial to follow the progress of Gemini’s regulatory settlements. If legal disputes are resolved smoothly, pricing might be announced in Q3, with valuations likely referencing Coinbase’s price-to-sales ratios. In the long term, Gemini plans to allocate 30% of its IPO proceeds to compliance technology upgrades and 20% to expanding into the Asian market, especially to secure licenses in Japan and Singapore.
Potential variables include the continuity of regulatory policies. Trump’s prospects for re-election may influence SEC enforcement, and a shift in power to Democrats could tighten crypto regulations. Additionally, overall market volatility is a key factor—if Bitcoin falls below the USD 72,000 support level, it could drag down the IPO valuation.
For investors, Gemini’s listing is not merely a commercial event; it is a litmus test for the integration of crypto companies with traditional financial systems. Its success will assess the industry’s ability to achieve compliance and will provide a critical benchmark for subsequent IPOs. Monitoring changes in GUSD liquidity can help gauge market confidence. In the era of crypto compliance, rational analysis of policy risks and fundamentals will be key to capturing long-term opportunities.
Neason Oliver
