Gemini lays off 10% of employees due to the "bad actors" of the crypto industry

Gemini, a cryptocurrency exchange owned by the Winklevosses, has launched its third round of job cuts in less than a year, laying off another 10% of employees.

Cameron Winklevoss claims the dismissal was due to a combination of macroeconomic pressures and "unprecedented fraud" in the crypto industry.

Reduction of the Gemini team

According to The Information on Monday, the publication received an internal message from Winklevoss saying he was "left with no choice" but to cut headcount.

"We had hoped to avoid further cuts after this summer, however continued negative macroeconomic conditions and unprecedented fraud being perpetrated by bad players in our industry have left us with no choice but to revise our forecast and continue to cut headcount," he said in the letter.

Pitchbook data shows that as of November 2022, Gemini had 1,000 employees, meaning that around 100 people were likely laid off. The last reduction occurred in July: 7% of the company's employees lost their jobs, after 10% were laid off a month earlier.

They are not alone in taking such drastic measures: Coinbase laid off another 950 employees earlier this month after cutting 18% of its staff in June. Cryptocom also cut another 20% of its workforce two weeks ago.

Most companies cite macroeconomic factors as their main pain point. Rising interest rates contributed to the collapse in the price of crypto assets in 2022, which hurt exchanges, miners, and trading companies.

Gemini Legal Battles

Winklevoss was particularly aggressive in his criticism of Barry Silbert, CEO of DCG, whose sales arm, Genesis, filed for bankruptcy last week. Winklevoss alleges that Silbert and both firms misrepresented their financial position to Gemini, whose Earn program now has user funds locked up in Genesis.

As for the scam, former FTX boss Sam Bankman-Freed was widely accused of the same after his exchange crashed in July. The Securities and Exchange Commission (SEC) filed charges against him for defrauding customers by pumping user funds into his trading company Alameda Research, to which he pleaded not guilty.

However, Gemini and Genesis are now both embroiled in their own issues with the SEC, which alleges they each offered unregistered securities to retail investors through Gemini Earn. Nexo, a rival crypto lending platform, has pulled out of serving US customers after numerous calls from regulators over the same issue.

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