Gemini's Brutal Retreat: 200 Jobs Cut, Three Markets Abandoned as the Winklevoss Twins Fight for Survival

The Announcement: "We Find Ourselves Stretched Thin"

In a blog post published alongside an SEC filing on February 5, Cameron and Tyler Winklevoss acknowledged what markets had been pricing in for months: Gemini's international ambitions were unsustainable. The twins wrote that operations in the UK, EU and Australia had "proven hard to win in for various reasons," citing a level of "organizational and operational complexity that drives our cost structure up and slows us down."

The numbers behind that admission are stark. Gemini's workforce peaked at approximately 1,100 employees in 2022, was halved to around 550 by the end of 2025 through earlier rounds of layoffs, and will now shrink to roughly 400 after the latest 25% cut impacts staff across Europe, the United States and Singapore. The company expects to complete both the layoffs and regional wind‑downs by the first half of 2026, subject to local labor laws and consultation requirements.

"These foreign markets have proven hard to win in for various reasons and we find ourselves stretched thin… And we don't have the demand in these regions to justify them. America has the world's greatest capital markets and America has always been where it's at for Gemini. So it's time for Gemini to focus and double down on America."

— Cameron and Tyler Winklevoss, Co‑Founders, Gemini NYpost

Timeline for Users: Withdrawal‑Only by March, Full Shutdown by April

For UK, EU and Australian customers, the transition follows a tight timeline. All affected accounts will switch to withdrawal‑only mode on March 5, 2026, meaning no new deposits, trades, staking or incentive programs will be available from that date. Full account closures are scheduled for April 6, 2026. Gemini has partnered with eToro to help users in affected regions migrate assets and minimize disruption, and is urging customers to cancel recurring orders and avoid new deposits immediately.

The exit reverses expansion efforts announced as recently as October 2025, when Gemini appointed James Logan as head of Australia and formalized registration with the Australian Transaction Reports and Analysis Centre (AUSTRAC). That a market entered barely four months earlier is already being abandoned underscores how rapidly conditions have deteriorated for mid‑tier exchanges trying to compete across multiple regulatory regimes simultaneously.

Financial Reality: $159M Loss, 0.1% Market Share, 85% Stock Crash

The strategic retreat is rooted in financial distress that has been building since Gemini's September 2025 IPO. In November, the company reported a worse‑than‑expected quarterly loss of $159.5 million, or $6.67 per share, in its first public earnings release — a figure that implied a negative operating margin of approximately ‑159%. Revenue has been squeezed by plummeting trading volumes: by January 2026, Gemini's global spot trading market share had fallen to just 0.1%, down from 0.6% in June 2025, as larger competitors like Coinbase and Binance absorbed the lion's share of shrinking activity.

Gemini's stock (GEMI) tells the story in a single line. After debuting at $28 per share and briefly touching an all‑time high of $45.89 in September 2025, shares have cratered roughly 85% to the low single digits, making it one of the worst‑performing crypto IPOs of the cycle. On the day of the restructuring announcement, GEMI fell a further 5–9% in early trading, reflecting market skepticism about whether cost cuts alone can reverse the trajectory. CNBCTV18

Why International Markets Became Unwinnable

Compliance Costs Outpaced Revenue

Running a crypto exchange across more than 60 countries requires navigating a patchwork of regulatory regimes, each with its own licensing, AML/KYC, capital‑reserve and consumer‑protection requirements. In the EU, MiCA's stablecoin and CASP rules — now moving toward full enforcement with a March 1, 2026 compliance cliff — demand significant ongoing investment in legal, compliance and technology infrastructure. In the UK, the FCA's evolving cryptoasset regime and stablecoin sandbox, while promising for well‑capitalized incumbents, layer on additional costs that smaller exchanges struggle to absorb.

For Gemini, the math simply did not work. The Winklevoss twins acknowledged that demand in the UK, EU and Australia "did not justify the operational costs," and that the complexity of maintaining multiple regulatory footholds was actively slowing the company's ability to compete and innovate. With MiCA implementation costs rising and UK FCA requirements expanding, the decision to exit now — rather than sink further capital into compliance for markets generating negligible revenue — is painful but arithmetically rational.

Bitcoin's 40% Crash Killed Trading Volumes

The broader crypto market has made everything harder. Bitcoin has fallen approximately 40% from its October 2025 cycle peak, dragging total crypto market capitalization down by trillions and compressing the trading volumes that are the lifeblood of exchange revenue. In that environment, only the most liquid, lowest‑cost platforms can sustain profitable operations. Gemini, with its smaller user base and higher cost structure, found itself squeezed from both sides: declining top‑line revenue and rising per‑unit compliance costs. Tradingview

The Pivot: AI, Prediction Markets and "Doubling Down on America"

Alongside the cuts, the Winklevoss twins laid out a new strategic vision centered on two pillars: artificial intelligence and prediction markets. On the AI front, Gemini claims that internal deployment of AI tools has boosted engineer productivity by up to 100x compared to pre‑AI benchmarks, enabling the company to operate leaner while maintaining product velocity. The twins wrote that "doing more with less has never been more true or possible," framing the layoffs as a natural consequence of automation rather than purely a distress signal.

The more ambitious bet is prediction markets. Gemini launched its own prediction‑market product in December 2025, competing with established platforms like Kalshi and Polymarket, and the Winklevoss twins now describe it as potentially "as big or bigger than today's capital markets." Their thesis is that collective intelligence, harnessed through market‑based forecasting, can generate insights about future events that traditional systems cannot — and that Gemini's regulated US infrastructure gives it a credibility advantage in this emerging space.

As of the latest available data, Gemini's prediction market has about 10,000 active users and $24 million in cumulative volume — modest numbers, but the company is betting that a US‑focused, compliance‑first approach will attract institutional users wary of offshore competitors.

Industry Context: Not Just Gemini

Gemini's retreat is the most visible, but it is not isolated. The broader crypto exchange sector is in a state of consolidation as the 2025–2026 downturn exposes businesses that expanded aggressively during the bull market without securing sustainable revenue bases. TradingView's coverage notes that miners such as Bitdeer have also announced restructurings, while smaller exchanges and DeFi platforms face similar pressures from shrinking volumes, rising compliance costs and a sentiment environment described as "unusually bleak."

At the same time, larger players like Coinbase, Binance and Kraken continue to invest in international licensing and product expansion, suggesting that the shakeout is concentrating market share among better‑capitalized incumbents rather than shrinking the overall addressable market. For mid‑tier exchanges like Gemini, the message is clear: scale, cost efficiency and regulatory positioning now determine survival.

What Happens Next: Can Gemini Survive?

Bloomberg's February 22 analysis, headlined "Winklevoss' Gemini Risks a Hard Landing After the Crypto Rout," asks the central question bluntly: whether the restructuring and pivot will move fast enough to matter. With GEMI trading near all‑time lows, a ‑159% operating margin, and a prediction‑market business still in its infancy, the path to profitability requires both a crypto market recovery and successful execution of a product pivot that is, by the twins' own admission, a multi‑year bet. Bloomberg

For affected users, the immediate priority is asset migration before the April 6 shutdown. For the broader industry, Gemini's retreat is a stress test for the thesis that regulated exchanges can profitably serve multiple jurisdictions: when the market turns, compliance costs do not shrink, but revenue does.

Bottom Line

Gemini's decision to cut 25% of its workforce and abandon three major international markets is the most significant exchange restructuring of 2026 so far, driven by a toxic combination of Bitcoin's 40% drawdown, a ‑159% operating margin, plummeting market share and unsustainable compliance costs across the UK, EU and Australia. The pivot to prediction markets and AI‑driven efficiency is bold but unproven, and with GEMI stock down 85% from its IPO high, the Winklevoss twins are now in a race against time to prove that a leaner, US‑focused Gemini can survive where a global one could not.

Gemini's retreat is a sobering reminder that brand recognition and famous founders do not insulate a business from the brutal economics of exchange competition during a downturn. The decision to exit markets just months after entering them — Australia being the starkest example — suggests that expansion was driven more by narrative ambition than by rigorous demand analysis. That said, the pivot to prediction markets is one of the more intellectually honest strategic bets in crypto right now: if the Winklevoss twins are right that collective forecasting will rival traditional capital markets, Gemini's US‑first, compliance‑first positioning could prove prescient. If they are wrong, or if the crypto winter deepens further, this restructuring may be remembered not as a turnaround but as the beginning of a longer decline. Either way, the industry should take note: in 2026, survival belongs to the lean, the licensed, and the locally dominant — not the globally stretched.