Gemini Sued as Stock Collapses 80% After IPO Pivot

Edgen Crypto

·Mar 20 2026, 14:56

Share to

Share to

Copy link

Key Takeaways

A class-action lawsuit filed in Manhattan federal court accuses Gemini and its co-founders of deceiving investors during the company's September 2025 IPO. The suit alleges the company presented a growth-focused strategy it secretly planned to abandon, leading to a severe stock price decline.

A lawsuit filed on March 18, 2026, alleges Gemini made false statements in its IPO prospectus about its business strategy.
Gemini's stock has collapsed more than 80% from a post-IPO high of $40 to approximately $6 per share.
The company pivoted from global expansion to prediction markets, cutting 25% of its workforce and exiting key international markets.

Gemini Stock Plummets 80% as Lawsuit Alleges IPO Deception

Gemini's stock has collapsed more than 80% since its public debut, triggering a class-action lawsuit filed on March 18, 2026, against the crypto exchange and its founders, Tyler and Cameron Winklevoss. The suit, brought by plaintiff Marc Methvin in Manhattan federal court, alleges the company's September 2025 IPO prospectus was materially misleading. After pricing its IPO at $28 per share and briefly touching $40, Gemini's stock now trades near $6 on the Nasdaq, wiping out significant shareholder value.

Strategy Shift from Global Growth to Niche Markets Detailed in Suit

The lawsuit claims Gemini executed a classic "bait-and-switch" on its public investors. The company raised capital based on a strategy of aggressive global expansion and user growth for its core exchange. However, by February 2026, just months after the IPO, executives announced "Gemini 2.0." This new strategy involved a pivot to speculative prediction markets, a 25% reduction in its workforce, and a full withdrawal from the European Union, United Kingdom, and Australia—regions previously highlighted as growth opportunities. The plaintiffs argue this abrupt change was not a reaction to market conditions but a premeditated plan, rendering the IPO disclosures false from the outset. This legal challenge focuses on securities law violations, a separate issue from the company's prior regulatory settlements related to its Earn program.