Gemini, the crypto exchange founded by the Winklevoss Twins, received approval from the Commodity Futures Trading Commission (CFTC) to act as a designated contract market (DCM), which it says it will use to operate a new prediction market.
Wednesday, the CFTC changed the status of Gemini’s application to “approved,” and the company wrote in a press release that its DCM approval is for a “U.S. License For Prediction Markets.”
“Today’s approval marks the culmination of a 5-year licensing process and the beginning of a new chapter for Gemini,” Gemini’s CEO Tyler Winklevoss said in the release.
Gemini already operates a crypto exchange, and when it first submitted application documents to the CFTC in March 2020 it appears to have been in order to offer a CFTC-registered crypto exchange. Its public application filings to the CFTC make no mention of a prediction market or of event contracts. However, in a filing in September connected to a planned initial public offering (IPO), Gemini revealed that it plans to offer a prediction market product too.
Tyler Winklevoss thanks acting CFTC chair
Tyler Winklevoss also praised Acting CFTC Chair Caroline Pham for her role in the process. The Winklevoss twins, both of whom are prominent donors to President Trump, appeared to play a role in sinking plans for Brian Quintenz — a Kalshi director and shareholder — to replace Pham as the CFTC chair. Quintenz’s nomination was scheduled last summer for a vote before the Senate Committee on Agriculture, Nutrition, and Forestry, but was pulled at the last minute twice. On the second occasion, the vote was reportedly removed from the schedule at the White House’s request following lobbying from the Winklevoss twins. The White House eventually withdrew Quintenz’s nomination and Michael Selig was nominated for the role instead.
“We thank President Trump for ending the Biden Administration’s War on Crypto and Acting Chairman Pham for her hard work and dedication to help realize President Trump’s vision for making America the crypto capital of the world,” Tyler Winklevoss added in the release. “It’s incredibly refreshing and invigorating to have a President and a financial regulator who are pro crypto, pro innovation, and pro America.”
Gemini says that trading event contracts via the Gemini mobile app will be “available soon.” Gemini may wish to file additional documents for prediction-market specific rules, which can typically be approved within 10 business days, and to self-certify contracts, after which new contracts can be offered as soon as the same day.
The press release gives examples of possible Gemini contracts including one on whether the price of Bitcoin tops $200,000, and one on whether Elon Musk pays a fine to the European Commission. It did not mention whether it would offer sports contracts.
Gemini shares jumped in after-hours trading following the news. After closing at $11.36 a share Wednesday, the stock hit a price of $13.80 after hours, a 21.5% increase. That would value the business at $1.6 billion, or $280 million more than its Wednesday closing price.
