Gemini, the New York-based cryptocurrency exchange founded by Cameron and Tyler Winklevoss, has announced that it will expand its services beyond the United States. The exchange plans to launch a crypto derivatives platform in Singapore, marking its first foray into the Asian market.
The announcement comes at a time when the demand for cryptocurrency derivatives trading is growing rapidly. Derivatives trading provides investors with an opportunity to bet on the future prices of assets without actually owning them. This can be a lucrative way to hedge against risk and potentially earn profits in volatile markets.
Gemini has received regulatory approval from the Monetary Authority of Singapore (MAS) to launch the derivatives platform. The platform will offer futures contracts on Bitcoin with plans to expand to other cryptocurrencies in the future. It will be the first time that Gemini will offer derivatives trading to customers outside the U.S.
According to the co-founder and CEO of Gemini, Tyler Winklevoss, the expansion into Asia is a natural next step for the company. He said, “Expanding our platform to Singapore is an important milestone for Gemini and an exciting step forward in our mission to empower individuals and organizations around the world to engage in cryptocurrency trading and investment with confidence.”
Gemini has been expanding its services rapidly in recent years. In 2018, the company launched its own stablecoin, Gemini Dollar (GUSD), which is pegged to the U.S. dollar. It has also launched custodial services for institutional investors, allowing them to securely store and trade cryptocurrencies.
The launch of the derivatives platform in Singapore is expected to attract a new wave of customers to the exchange. Singapore is a hub for cryptocurrency trading in Asia, with many exchanges and trading firms based in the city-state. The MAS has been supportive of the cryptocurrency industry, providing clear regulations for companies to operate in the country.
Gemini’s move into Asia is part of a broader trend in the cryptocurrency industry. Many exchanges and trading firms are expanding into new markets to tap into the growing demand for cryptocurrency products. The derivatives market, in particular, has seen significant growth in recent years.
According to a report by CryptoCompare, derivatives trading volumes increased by 54% in Q2 2020, reaching an all-time high of $2.26 trillion. The report also found that Bitcoin futures accounted for 78% of the trading volume.
Gemini’s entry into the crypto derivatives market is expected to provide a new avenue for investors to trade and hedge their cryptocurrency positions. As the industry continues to mature, it is likely that more financial products and services will be offered to customers.
Gemini’s decision to expand into Singapore also highlights the importance of regulatory clarity in the cryptocurrency industry. The MAS has been a leader in providing clear guidelines for companies to operate in the country. This has attracted many cryptocurrency firms to Singapore, which has become a hub for innovation and development in the industry.
Gemini’s expansion into Asia is a significant development for the company and the cryptocurrency industry as a whole. With the derivatives market growing rapidly, Gemini is poised to capture a portion of the trading volume and expand its customer base. As demand for cryptocurrency products and services continues to grow, it is likely that more companies will follow Gemini’s lead and expand into new markets outside the U.S.
Gemini, the U.S.-based crypto exchange, has made an announcement that it plans to launch a derivatives platform outside the country under its new division, Gemini Foundation. The first product of Gemini Foundation will be a perpetual bitcoin (BTC) contract denominated in Gemini dollars (GUSD), with an ether (ETH) perpetual contract also linked to GUSD in the pipeline. Unlike conventional derivatives, perpetuals do not have an expiration date.
The move comes at a time when U.S. regulators and lawmakers are scrutinizing cryptocurrencies and their role in the world’s largest economy. Gemini has been affected by the campaignes as it was accused by the Securities and Exchange Commission in January of selling unregistered securities. Being based outside the U.S. does not mean the Gemini Foundation will be out of reach of U.S. watchdogs, as Binance, the largest crypto exchange, was sued by the Commodity Futures Trading Commission in March, despite being based elsewhere.
It is believed that the decision to launch the derivatives platform outside the U.S. may have been influenced by the regulatory environment in the country. Gemini may have been looking for a less restrictive environment to deploy its products and services. As such, the move offers the exchange an avenue to test out innovative products outside the watchful eye of U.S. regulators.
Perpetual contracts are a popular derivative product in the cryptocurrency space, and the addition of the contracts to the Gemini Foundation will likely attract more users to the platform. Moreover, the contracts’ linkage to Gemini dollars offers an added layer of convenience for users who are already using Gemini’s dollar pegged stablecoin.
Gemini has been an industry leader in adhering to regulatory standards, with the exchange laying a strong emphasis on compliance since its inception. The company’s decision to launch the derivatives platform outside the country does not change its commitment to regulatory standards. Instead, it only highlights the need for a regulatory environment that fosters innovation and allows companies to compete globally.
The announcement by Gemini Foundation comes at a time when several other crypto exchanges are exploring different markets to expand their operations. Binance, for instance, has been expanding its reach globally, setting up regional offices in several countries. FTX, on the other hand, moved its headquarters from Hong Kong to Antigua and Barbuda after facing regulatory challenges in Hong Kong.
In conclusion, Gemini’s decision to launch a derivatives platform outside the U.S. reinforces the importance of a regulatory environment that enables innovation and competition. The move may also attract more users to the platform, as perpetual contracts are a popular derivative product in the cryptocurrency space. As the crypto industry continues to evolve, it will be important to strike the right balance between regulation and innovation.
