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Tyler and Cameron Winklevoss, the billionaire twin owners of Gemini have sourced from their finances to support Gemini according to people familiar with the matter.
Gemini Trust Co, the crypto exchange, has faced financial hurdles during the bear market. In response to the setbacks, the Winklevoss twins have sought to find outside funding from external investors. However, with no agreements, they have funded the company further themselves with a $100 million injection to the company, according to a Bloomberg report.
After the crash of FTX and the market’s downturn over the past year, funding for cryptocurrency start-ups and established institutions has been difficult to source. The cryptocurrency lending firm Genesis Global Holdco’s involvement in funding FTX took a major toll on the industry overall. Genesis Global had been the crypto exchange‘s only partner as part of its lending product. Since the crash, Gemini had to put a suspension on its Earn programme with Genesis freezing withdrawals. Nearly $1 billion in customer funds were left without withdrawal options. Earlier this year, Barry Silbert of the parent group of Genesis (Digital Currency Group) and the Winklevoss twins came to an agreement to resolve a dispute that resulted from the frozen accounts. Under the agreement, Gemini would need to fund $100 million. The loan from the twins apparently wouldn’t be used for this but to help fund operations in the company.
Gemini’s struggles in the cryptocurrency industry
At the beginning of the year, Gemini lost 10% of its workforce to layoffs in a bid to cut costs. The CEO of the company also stepped away to pursue a role at the competitor company in January, leaving Gemini vulnerable.
Gemini has also been under fire from authorities in the US. According to the United States Securities and Exchange Commission (SEC), Gemini’s Earn product broke securities law. This led to the SEC suing the exchange. The Commodity Futures Trading Commission also slapped Gemini with a lawsuit under allegations that the exchange had misrepresented contracts and misled the derivatives regulator.