Gemini enters maintenance mode, a familiar feeling?
The U.S. compliant exchange Gemini announced last night that the platform entered maintenance mode. The official statement mentioned that they are currently investigating application recovery issues and stated that trading will resume shortly. However, as of the deadline, no positive update has been reported.
We are entering maintenance mode while we investigate an application recovery issue. Our team is working diligently to address this issue and we expect all systems to be back online shortly.
— Gemini (@Gemini) December 20, 2022
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Who is Gemini?
Gemini is registered as a limited purpose trust company under the strict supervision of the New York State Department of Financial Services (NYDFS), making it one of the early compliant companies in the United States. Gemini's clients include institutional investors and high-net-worth individuals. According to information on their website, clients must have assets equivalent to ten million US dollars and a minimum transaction amount of 250,000 US dollars to use their products.
The stablecoin issued by Gemini, GUSD, is approved by NYDFS and the reserves are held in banks insured by the Federal Deposit Insurance Corporation (FDIC) and other money market funds. In October this year, Gemini announced a partnership with the decentralized stablecoin protocol MakerDAO to provide liquidity and yield for its special vault PSM.
Suspension of Gemini Earn Product due to Genesis Incident
In an announcement on 11/16, Gemini stated that withdrawals have been temporarily suspended as one of the partners of their yield product "Gemini Earn" is Genesis. Gemini emphasized that this does not affect other services such as staking, custody, trading, etc., and customers can withdraw funds at any time.
For customers of Gemini Earn, the company has also formed a creditors' committee and pledged to actively pursue funds for customers. Gemini has set up a dedicated section on their website Gemini Earn Updates, and according to the latest announcement yesterday, Gemini is working with the financial firm Houlihan Lokey, known for financial restructuring and mergers and acquisitions, to coordinate a solution to address liquidity issues with Genesis and DCG, with progress expected this week. It is reported that the debt owed amounts to as much as 9 billion US dollars.
Amid the ongoing market FUD, if you suddenly feel a sense of déjà vu when Gemini announces platform maintenance, you are not alone. Let's hope that everything will be as the official statement says and the platform will soon resume operations.
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