Gemini nabs US license to offer prediction markets

Regulatory Approval for New Offerings

Crypto exchange Gemini, founded by billionaire twins Tyler and Cameron Winklevoss, has obtained a crucial license from the Commodity Futures Trading Commission (CFTC) to launch prediction markets within the United States. This development marks a significant expansion of Gemini's regulatory approvals and its entry into a new market segment.

Gemini announced on Wednesday that its affiliate, Gemini Titan, has been granted a designated contract market license by the CFTC. The exchange stated its intention to "enter into the prediction markets space" following this approval.

The company further elaborated that, commencing shortly, its United States-based users will gain the ability to trade event contracts directly on the Gemini web platform. This move is anticipated to pave the way for future expansions in Gemini's US derivatives offerings, potentially including crypto futures, options, and perpetual contracts.

Gemini now joins a growing number of cryptocurrency companies that are venturing into the prediction markets domain. These platforms enable users to place bets or trade on the potential outcomes of a wide array of events, spanning from sports competitions to geopolitical developments.

Market Reaction and Strategic Outlook

Following the announcement, shares in Gemini (GEMI) experienced a notable surge, climbing 13.7% in after-hours trading to reach $12.92. This increase occurred after the stock had closed the regular trading session down by 0.7%.

Gemini nabs US license to offer prediction markets — *Shares in Gemini saw a significant jump following the company's announcement regarding its plans to offer prediction markets. Source: Google Finance*

This newly acquired license is poised to provide a substantial boost for Gemini. The company's stock has faced challenges, being down 64.5% since its public debut on September 12, amidst a broader struggle in the crypto market to sustain a rally.

Cameron Winklevoss, president of Gemini, expressed optimism about the potential of prediction markets, stating, "Prediction markets have the potential to be as big or bigger than traditional capital markets."

Gemini CEO Tyler Winklevoss highlighted the extensive timeline involved in securing this regulatory approval. He noted that the company initially applied for the license in March 2020, and its subsequent approval "marks the culmination of a 5-year licensing process and the beginning of a new chapter for Gemini."