Cryptocurrency exchange Gemini has become embroiled in a class-action lawsuit from investors after abruptly shifting its business model to focus on prediction markets following its listing, Cointelegraph reported on March 19.
Gemini shareholders filed a lawsuit against Gemini, co-founders Tyler Winklevoss (타일러·카메론 윙클보스) and Cameron Winklevoss, and company executives. They claim the company provided false information at the time of its listing and are seeking a jury trial and damages.
Gemini listed on Nasdaq in September last year, starting trading at $28 a share. The stock rose as high as $40 but has since plunged more than 80 percent and is now trading at around $6. The investors who filed suit say Gemini announced at the time of the listing that it would grow into a global cryptocurrency exchange, but later shifted to a prediction market-focused 'Gemini 2.0' and changed its fundamental business model. In the process, it carried out sharp restructuring, cutting 25 percent of its workforce and withdrawing from the European Union, Britain and Australia markets.
Cointelegraph said the shift ultimately undermined investor trust and led to the lawsuit.
Chi-gyu Hwang
delight@d-today.co.kr