Shareholders filed a class action lawsuit in New York against crypto exchange Gemini, co-founders Tyler and Cameron Winklevoss, and multiple executives, alleging that the exchange misled investors during its 2025 initial public offering (IPO).
Gemini Accused Of Misleading InvestorsThis week, crypto exchange Gemini and several executives were hit with a class action lawsuit for allegedly misleading investors before and after the exchange’s September 2025 IPO due to its strategy pivot.
Gemini has primarily generated revenues through transactions, deposits, and fees charged to users of its crypto platform, the Plaintiff highlighted, noting that the IPO documents reportedly described the company’s revenue growth strategy as “predominantly focused on expanding [its] exchange platform via increased MTUs [monthly transacting users] (…) increased average daily trading volume, and increasing the number of assets available on [its] platform.”
The documents stated that Gemini would increase monthly transacting users through acquiring new retail and institutional users and expanding internationally.
The ‘Gemini 2.0’ Strategy PivotThe complaint emphasized the exchange “gave no indication that the Company was poised for an abrupt corporate pivot to a prediction-market-centric business model” or that it would abandon its international growth strategy just months after the IPO.
According to the lawsuit, “the truth began to emerge” in February 2026, when the crypto exchange co-founders, Tyler and Cameron Winklevoss, announced a corporate pivot to “Gemini 2.0.”
The Winklevoss twins acknowledged the challenges Gemini has faced in the international market, arguing that the crypto exchange needed to simplify its structure to stay competitive.
However, the lawsuit alleges that, on this news, Gemini’s Class A common stock price fell 8.72%, to close at $6.70 per share on February 5, 2026. Similarly, it noted that the stock price fell 12.9% on February 17, 2026, on the news of the departure of three senior leaders.
In addition, the firm reported operating expenses of $520 million to $530 million, a 40% increase from the previous fiscal year, the lawsuit added. It’s worth noting that Gemini’s stock price briefly dropped to an all-time low of $5.51 on March 20, before bouncing to the $5.75 area. This represents a more than 80% drop from its September all-time high of $40.
“As a result of Defendants’ wrongful acts and omissions, and the precipitous decline in the market value of the Company’s securities, Plaintiff and other Class members have suffered significant losses and damages,” the lawsuit stated, seeking a jury trial and damages for investors who bought shares during the IPO and the Class Period.
