Crypto Exchange Gemini Loses JP Morgan as Banking Partner
According to a report from CoinDesk, the Gemini crypto exchange lost a major partner, banking giant JP Morgan. The report cited a person familiar with the matter, who did not provide further details about the decision.
Over the past few years, as the price of Bitcoin and other cryptocurrencies have plummeted, more companies and projects have stepped up and filed for bankruptcy protection. The twins have seen their share of scandals.
Gemini’s rocky months cause JP Morgan to break up?
As Bitcoinist reported, Gemini has been investigated by the US Securities and Exchange Commission (SEC). The crypto exchange was charged with offering an unregistered security via its defunct “Earn program”.
This investigation and the events surrounding Gemini Earn may have led to JP Morgan’s decision. However, there is no official statement from the banking giant or Gemini regarding the report.
The Earn program has been controversial and is at the heart of the exchange’s latest editions. When Gemini’s critical program partner and Digital Currency Group (DCG) subsidiary Genesis ceased operations, users were unable to withdraw their funds from the platform.
These users send their cryptocurrencies to the Earn program to receive stake rewards and a return generated by Genesis. The FTX collapse affected the latter and its bankruptcy process.
As a result of these events, Gemini entered into negotiations with DCG to restructure a billion debt. Additionally, Cameron and Tyler Winklevoss, the crypto exchange’s founders, received lawsuits from their users.
These events occurred as the crypto market continued to see a decline in the price of top cryptocurrencies, including Bitcoin and Ethereum. Global regulators are aiming to impose stricter rules on the nascent sector.
Despite JP Morgan’s decision to cut ties with Gemini, the report claims that its relationship with Coinbase will continue. Thus, it is likely that the break with the Winklevoss-founded company is related to the scandals mentioned above.
If so, will other major partners end their relationship with this crypto exchange? Remains to be seen. At the time of writing, Bitcoin (BTC) is trading at $22,000 as the asset’s decline extends and targets lower support levels.
Update: Gemini denied the report and confirmed that its relationship with JP Morgan will continue, according to a Twitter post.
Despite reports to the contrary, Gemini’s banking relationship with JPMorgan remains intact.
— Gemini (@Gemini) March 8, 2023
Cover image from Unsplash, chart from Tradingview.
