Gemini Crypto is getting sued.
Shareholders filed a class-action in Manhattan federal court claiming the exchange lied to investors during its September IPO.
The target is the company itself and the Winklevoss twins. The allegation is that Gemini raised capital on a growth story, then quietly ditched it for prediction markets and cost-cutting the moment the money was in.
The stock tells the rest of the story. From a post-IPO high of $40 down to around $6. That is an 80% collapse, and now the people who bought in want answers.
Key Takeaways
- Lawsuit Details: Plaintiff Marc Methvin filed the class-action in Manhattan, accusing Gemini executives of misleading shareholders about the company’s business model.
- Stock Collapse: After pricing its IPO at $28 and touching $40, Gemini shares handled on Nasdaq have plummeted more than 80% to trade near $6.
- Strategic Pivot: The complaint alleges Gemini secretly planned to pivot from its core exchange product to a prediction market model while cutting staff and exiting key regions.
The Mechanics of the Bait-and-Switch Allegation: What the Lawsuit Claims
The lawsuit comes down to one thing: what Gemini told investors and what it actually did.
Gemini listed on the Nasdaq in September at $28. The pitch was global expansion, user growth, and a central exchange built to scale internationally. Shareholders bought in. Then the story changed fast.
By November, executives were still talking up key global markets. By February, the Winklevoss brothers scrapped the entire narrative.
They announced Gemini 2.0, a pivot toward prediction markets, alongside a 25% workforce reduction. Then came the exits. EU, UK, Australia. Every market flagged as a growth opportunity, gone.
Expectations are building for a rate cut
There’s a 37% probability the June FOMC will cut 25bps
Powell has been the last line holding rates as President Trump publicly pushed to lower
June is also the first Fed meeting where Powell is not acting chair pic.twitter.com/xnAO7eIaQT— Gemini (@Gemini) March 18, 2026
The plaintiff argues this was not a reaction to market conditions. It was a planned strategy shift that made the IPO materials misleading from the start.
If internal communications contradict what was in the prospectus, that is a serious problem. Dismissing a misleading disclosure charge is hard when the paper trail works against you.
The regulatory environment does not help Gemini here either. When shareholder litigation runs on securities law, and securities law does not bend for sentiment. This is also a different fight from the Earn program settlement. That was about unregistered securities. This is about whether investors were sold a business model that was already being abandoned.
The pivot to prediction markets trades a large addressable market for a speculative niche. Gemini capped its own ceiling and the stock reflects it.
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