Crypto exchange Gemini is facing a class action lawsuit from shareholders who claim the company illegally failed to disclose its pivot into prediction markets-and overstated the viability of its struggling core business.
The federal suit, filed this week in the Southern District of New York, alleges Gemini and its founders, Tyler and Cameron Winklevoss, materially misled investors in the build-up to taking the company public last fall.
The lawsuit claims Gemini "overstated the viability of its core business as a crypto platform" and "overstated its commitment to and/or the viability of growing its business through expanding its international operations."
In February, the exchange laid off over a quarter of its staff and exited Europe and Australia, citing plans to use AI to boost efficiency. That same day, the Winklevoss twins announced the company planned to make its new prediction market platform "front-and-center" for users.
Since going public six months ago, Gemini's stock (Nasdaq: GEMI) has lost nearly 85% of its value. In the same period, Bitcoin has shed some 40% of its price.
On Thursday, Gemini shares rose nearly 7% in after-hours trading after reporting more stable revenue streams in 2025 and signaling success from cost-cutting efforts-though it also reported a $582.8 million net loss for 2025.
Gemini did not immediately respond to requests for comment on the case.