Original | Odaily Planet Daily ( @OdailyChina )

Author｜jk

On September 12th, the cryptocurrency exchange Gemini officially listed on the Nasdaq under the ticker symbol GEMI, marking the fulfillment of a long-cherished IPO for the trading platform founded by the Winklevoss twins. However, initial market enthusiasm was quickly tempered by real financial data . After a dramatic surge on its opening day, the stock price quickly retreated, revealing that the company's fundamentals had failed to win the confidence of retail US stock investors.

The long road to listing: from a valuation of 7.1 billion to IPO

Gemini's road to an IPO has been fraught with twists and turns. Founded in 2014 by brothers Cameron and Tyler Winklevoss, the cryptocurrency exchange began preparing for its IPO several years ago. The company reportedly spent approximately three years preparing for its IPO, but due to unfavorable market conditions and a weak IPO environment, it was forced to postpone its IPO twice, in mid-2024 and again in April 2025.

During the cryptocurrency bull run in late 2021, Gemini secured a $7.1 billion valuation in a funding round. However, the subsequent cryptocurrency market crash in 2022, including the collapse of its Earn product and the bankruptcy of its partner Genesis, forced Gemini into contraction mode. It wasn't until mid-2025, with improved market sentiment and a clearer regulatory environment, that the company revived its IPO plans.

In June of this year, Gemini confidentially filed for an IPO with the SEC, joining a wave of cryptocurrency companies like Circle and Bullish that have gone public. Ultimately, after months of preparation and roadshows, the company opted for a traditional IPO on the Nasdaq.

Relatively speaking, Gemini's listing did not cause much stir in the cryptocurrency circle. One reason is that it focuses on the domestic US market , and the two founding brothers were guests of honor at President Trump's crypto-related meetings. At the same time, Gemini's listing style is more "quietly entering the village" , so its volume is far less anticipated than the up-and-coming Bullish.

The stock price journey from frenzy to calm

Gemini's IPO pricing underwent multiple adjustments, initially ranging from $17 to $19, then raised to $24 to $26 due to strong demand. The final price was $28 , at the top end of the revised range. This price reflects strong market demand for the stock. According to Reuters, the subscription multiple exceeded 20 times , demonstrating investors' enthusiasm for the concept of a US-based cryptocurrency exchange.

However, the opening day's performance was dramatic, a roller-coaster ride that brought the stock price back to square one. Trading began at 1:40 PM and immediately jumped to $37.01, a 32% increase from the IPO price. Early in trading, the stock price soared to $45.89, a 64% increase that even triggered a volatility trading halt. The initial enthusiasm quickly gave way to reason: by the close of the day, the stock had fallen back to $32, paring its gains to about 14%.

Even more worrying was the performance in the following days: as of September 16, GEMI's stock price had fallen to around $30.42, a drop of about 6% that day and nearly 24% from its highest point since its listing. This sharp pullback, to some extent, reflects investors' re-examination of the company's fundamentals.

So what is the reason for their scrutiny?

Harsh financial reality

Gemini's financial performance is a major concern, contributing to its stock price decline. According to SEC filings, the company reported revenue of $68.6 million in the first half of 2025, a 7.7% decrease from $74.3 million in the same period last year. More seriously, its net loss reached $283 million, a significant increase of 580% year-over-year, compared to a loss of $41.4 million in the same period last year . Furthermore, the first half of this year wasn't a bear market; therefore, a key question for investors is where the money went.

This deteriorating performance trend is deeply concerning. Looking at the longer term, Gemini's full-year revenue for 2024 is projected to be $142.2 million, a 44.8% year-over-year increase, but it will still incur a net loss of $158.5 million (meaning its losses in the first half of this year were greater than those for the entirety of last year). For the 12 months ending June 30, 2025, the company's revenue was $136.45 million, indicating stagnant revenue growth.

Analysts point out that Gemini currently relies heavily on transaction fee income, which will account for approximately 70% of total revenue in 2024. The company's surge in losses in the first half of 2025 is mainly attributed to special expenses such as legal fees, debt interest, and asset impairment related to the Genesis bankruptcy case and the Earn project.

Despite the disappointing financial figures, Gemini's operational metrics continue to show some growth. Monthly active trading users reached 523,000 in the first half of 2025, up from 497,000 in the same period last year. Trading volume also surged significantly, from $16.6 billion in the same period last year to $24.8 billion, a nearly 50% increase . As of July 31, 2025, the company's monthly trading users further increased to 549,000.

Comparison with Bullish: Different fates of companies listed at the same time

Gemini's IPO follows closely on the heels of other cryptocurrency companies, and stands in stark contrast to Bullish, which debuted on the New York Stock Exchange about a month ago. Bullish, an institutional-focused digital asset platform led by former NYSE President Tom Farley and backed by prominent investors including Peter Thiel, BlackRock, and ARK Invest, set a positive tone for the overall cryptocurrency IPO market.

Judging from their first-day performance, both companies experienced a dramatic surge. Bullish completed its IPO on August 13th at $37, raising approximately $1.1 billion and valuing the company at approximately $5.4 billion. On opening day, its share price immediately jumped to $90, a 143% increase. Its intraday high reached $118, a surge of over 200%, far exceeding Gemini's first-day peak of 64%. Bullish also performed strongly, closing at $68 on its first day, up 84%.

However, the two companies' subsequent performances were nearly identical. By mid-September, Bullish's stock price had fallen back to around $51, a 56% drop from its peak, with a current market capitalization of approximately $7.8 billion. This correction was more severe than Gemini's 24% drop, demonstrating that even stronger cryptocurrency IPOs struggle to sustain initial market enthusiasm.

The gap in market capitalization between the two is stark. Gemini's IPO price of $28 yielded an initial market capitalization of approximately $3.3 billion, and its current share price of approximately $30 translates to a market capitalization of approximately $3.8 billion. In contrast, Bullish's valuation of $5.4 billion at its IPO and its current market capitalization of approximately $7.8 billion significantly surpasses Gemini, demonstrating a significant latecomer advantage.

Comparing Coinbase and Kraken, the huge gap in the industry's competitive landscape

Comparing Gemini to its main competitors, the disparity in scale and profitability is striking. Coinbase, the largest publicly traded cryptocurrency exchange in the United States, far surpasses Gemini in every metric.

In terms of revenue scale, Coinbase's revenue for the first half of 2025 is approximately $3.53 billion, including $2.03 billion in the first quarter and $1.5 billion in the second quarter. This figure is 51 times Gemini's $68.6 million in revenue during the same period, fully demonstrating the huge gap between the two. Even more impressive is that Coinbase achieved a net profit of $1.43 billion in the second quarter, with earnings per share of $5.14, while Gemini was mired in losses.

The gap is equally stark in terms of trading volume. Coinbase's retail trading volume in the second quarter reached $43 billion, a 16% year-on-year increase, far exceeding Gemini's total trading volume of $24.8 billion in the first half of 2025. Coinbase's subscription and service revenue reached $655.8 million in the second quarter, a single revenue item that is close to Gemini's full-year revenue.

Privately held Kraken exchange also performed strongly, significantly surpassing Gemini in both scale and profitability. In the first half of 2025, Kraken recorded $884 million in revenue, including $472 million in the first quarter and $412 million in the second quarter, representing year-on-year increases of 19% and 18%, respectively. This revenue is 13 times that of Gemini, demonstrating Kraken's dominant position in the market.

More importantly, Kraken maintained healthy profitability, with adjusted EBITDA reaching $187 million in the first quarter, $80 million in the second quarter, and a total of approximately $267 million in the first half of the year. In contrast, Gemini is not only smaller but also faces significant losses.

This disparity is even more pronounced when looking at historical financial data. Coinbase's full-year revenue for 2024 reached $6.56 billion, a year-on-year increase of 111%, and its net profit reached $2.58 billion, a remarkable 41% profit margin. The company successfully transitioned from a net loss of $2.6 billion in 2022 to substantial profitability, demonstrating strong cyclical recovery capabilities. Kraken's revenue in 2024 reached $1.5 billion, a year-on-year increase of 128%, with adjusted EBITDA of $424 million. The company maintained near-breakeven performance during the crypto winter of 2022-2023, incurring a loss of only $1.8 million in 2022. Entering the market recovery period of 2024, Kraken quickly achieved strong profit growth.

In contrast, Gemini will only achieve $142.2 million in revenue and a net loss of $158.5 million in 2024. The company's performance deteriorated further in the first half of 2025, raising doubts about its ability to maintain its position as the third-largest US exchange. In comparison, Gemini seems to be considering its IPO as the final straw.

As of June 2025, the company's cash balance is only $42.8 million, while its short-term debt is approximately $680 million, resulting in a very tight balance sheet. This financial situation partly explains why the company urgently needs to raise funds through an IPO to improve its capital structure.

The diverging trend of cryptocurrency IPOs

Gemini's IPO is a crucial component of the cryptocurrency IPO boom in 2025, which is expected to be the year of the IPO. Amidst a more welcoming regulatory environment, several cryptocurrency companies are choosing to list on public markets in 2025. Besides Gemini and Bullish, stablecoin issuer Circle also successfully completed its IPO in June, with its stock price soaring on its first day of trading, setting a positive precedent for the entire industry.

However, Gemini's performance represents a clear divergence in the market. While factors such as an improved regulatory environment, increased institutional adoption, and inflows into Bitcoin ETFs have provided positive support for the entire industry, investors clearly prefer companies that are already profitable or close to profitability.

Compass Point analyst Ed Engel noted that GEMI currently trades at 26 times its annualized first-half revenue. This multiple is indeed high for a loss-making company in a volatile industry, and may be a significant factor in investor caution and the stock price correction.

Future Outlook: Kraken to go public next year

Kraken is reportedly planning an IPO in 2026 and is currently raising $500 million at a valuation of $15 billion in preparation for its eventual listing. This is a company with healthy revenue.

Kraken's co-CEO has stated that the company's IPO strategy relies on clarity in the regulatory environment. In contrast, Gemini chose to conduct its IPO in the current regulatory environment, thus taking on some first-mover risk.

From a broader industry perspective, Gemini's IPO experience highlights the maturation of the cryptocurrency exchange industry. Investors are no longer satisfied with mere concepts and growth stories, but are increasingly focused on actual profitability and sustainable business models. This trend is likely to drive the entire industry towards a greater focus on operational efficiency and profitability.