Gemini Trading Volume Plunges 73% as Third-Quarter Revenue…

Gemini shares rose approximately 6.5% in after-hours trading on Thursday to $2.79 following the earnings announcement, despite remaining sharply lower for the year.

The results illustrate Gemini’s continuing dependence on cryptocurrency trading conditions even as management reduces costs and expands into credit cards, prediction markets and institutional trading infrastructure.

How Much Did Cost Cuts Improve Gemini’s Losses?

Operating expenses declined 30% year over year to $119.9 million from $171.4 million, marking the third consecutive quarterly reduction. Expenses were also 2% below the second quarter’s $122.4 million.

The reduction reflected lower compensation and marketing spending following workforce cuts and tighter expenditure controls. Sales and marketing expenses fell 75% year over year to $8.3 million, while salaries and compensation decreased 32% to $56.4 million.

Despite those reductions, Gemini remained deeply unprofitable. Its operating loss reached $79 million, wider than the $76.9 million operating loss recorded in the preceding quarter as revenue weakened.

The improvement in net income was therefore not entirely attributable to operating efficiency. Gemini reported a $25.7 million net gain from realized and unrealized changes involving crypto assets and related-party crypto loans, compared with a $25 million loss in the second quarter.

That favorable swing helped narrow the company’s adjusted EBITDA loss to $11.6 million from $74 million in Q2.

The latest figures follow a difficult second quarter, when Gemini reported a $107.7 million net loss amid declining trading activity and elevated credit-related expenses.

Investor Takeaway

Why Did Trading Volume Fall While Platform Assets Recovered?

Gemini’s quarterly trading volume declined from $16.4 billion a year earlier, reflecting weaker retail cryptocurrency activity. However, volume increased 18% from $3.8 billion in the second quarter, supported by institutional Zcash trading and expanded affiliated market-making.

Approximately $1.2 billion, or 26% of quarterly spot trading volume, involved transactions between external customers and Gemini’s market maker.

The distinction matters when assessing the quality and sustainability of trading activity, particularly as exchange revenue increased only 7% sequentially despite the larger recovery in volume.

Monthly transacting users fell 2% year over year to 577,000, suggesting the recovery in trading volume has not yet translated into broader customer growth.

Meanwhile, assets held on Gemini’s platform increased to $13.4 billion from $8.4 billion at the end of June. However, they remained below the $21.3 billion recorded a year earlier, reflecting lower cryptocurrency valuations and certain institutional custody outflows.

Services revenue and interest income totaled $23.3 million, accounting for 59% of net revenue. Credit card revenue reached $15.5 million, up 82% year over year but down 4% sequentially.

The credit card business also presented continuing risks. Transaction losses totaled $10.6 million, including $9.2 million in credit card provisions, while charge-offs increased to $11.5 million, primarily related to accounts affected by a previously disclosed fraud incident.

Can Prediction Markets Become a Meaningful Revenue Source?

Gemini’s prediction markets generated $800,000 in third-quarter revenue, up 52% from approximately $500,000 in Q2. Although growing faster than the exchange’s other businesses, the segment still represents less than 2% of total quarterly revenue.

The company’s strategy increasingly centers on offering regulated trading and clearing infrastructure to third-party brokerage platforms rather than relying exclusively on direct customer acquisition.

In August, Gemini announced a proposed partnership with Apex Fintech Solutions under which its Gemini Titan subsidiary would serve as the exclusive regulated venue for cryptocurrency event contracts distributed through Apex’s futures commission merchant business.

The arrangement remains subject to definitive agreements and has not yet been finalized.

Gemini also intends to make its exchange and clearinghouse available to additional brokerages and trading platforms seeking prediction market access without developing their own regulated infrastructure.

The strategy builds on Gemini’s existing regulatory approvals, including the CFTC derivatives clearing license obtained by its Gemini Olympus subsidiary, allowing the company to operate clearing infrastructure alongside its regulated trading venue.

Gemini President Cameron Winklevoss described the infrastructure-focused approach as central to the company’s next phase, emphasizing the value of owning regulated systems that other financial businesses can use.

Investor Takeaway

What Do the Results Mean for Gemini’s Financial Position?

Gemini ended September with $194.1 million in cash and cash equivalents, down from $252.2 million at the end of 2025.

The company continues to balance investment in new trading products with the need to reduce operating losses and preserve liquidity.

Its third-quarter performance indicates progress in controlling expenditure, but restoring sustainable profitability will depend on whether trading activity recovers and newer businesses generate sufficient recurring revenue to support the company’s operating infrastructure.

Investor Takeaway