Gemini's stock price has crashed to a record low, continuing a trend that started soon after its initial public offering in September. The company's share price decline has triggered a $2.6 billion wipeout and coincided with the broader sell-off in Bitcoin and treasury companies. Technical analysis suggests further downside potential, with the stock possibly reaching $5.
Gemini Space Station, a company backed by the Winklevoss Twins, has plunged to a record low of $9.70. This represents an approximately 80% drop from its all-time high, with its market capitalization shrinking from $3.81 billion to the current $1.14 billion.
Reasons for the Gemini Stock Price Crash
Gemini, established in 2013 by Tyler and Cameron Winklevoss, is a prominent crypto exchange. It went public in September, following the path of other crypto-related companies such as Circle, Bullish, and Figure.
Following an initial surge to $45, the stock began a significant decline, reaching its current price of $9.80. This plunge has occurred concurrently with the recent crypto market crash, which has impacted Bitcoin (BTC) and various other altcoins.
The stock's performance has also mirrored the sharp decline observed in Bitcoin treasury companies, including Metaplanet and Michael Saylor's Strategy. Gemini ranks as the 26th-largest Bitcoin treasury company globally, holding 4,002 BTC, valued at $372 million.
The decrease in Gemini's stock price is attributed to the performance of Bitcoin and other altcoins over the past few months. Historically, crypto exchanges tend to experience lower trading volumes during bear markets.
In contrast to Coinbase, Gemini derives most of its revenue from transaction handling. The company does not possess a substantial custody, stablecoin, or subscription business segment.
Gemini recently published a mixed financial report. Its revenue for the third quarter rose to $50.6 million, an increase from $24 million in the same period last year. However, its net loss expanded to $160 million, up from $87 million.
The increasing losses suggest that the company might need to raise capital. At the end of the quarter, Gemini had $487 million in cash and equivalents, along with $87 million in restricted cash and cash equivalents.
GEMI stock has also been affected by waning investor sentiment towards newly listed companies. Circle, which experienced an initial surge, has since plunged, erasing over $40 billion in value. Similarly, Bullish stock has dropped by 65% from its all-time high. eToro and Webull, both offering crypto trading solutions, have also seen their stock prices decline.
Gemini Space Station Stock Analysis
Analysis of the two-hour chart indicates that the GEMI stock price has been in a strong downtrend over the past few months. The stock has formed a descending channel and has consistently traded below the 50-period moving average.
Gemini stock has remained below the Supertrend indicator and has continuously formed a series of lower lows and lower highs. Consequently, the most probable outlook is a continued decline, with bears targeting the support level at $5. This bearish outlook would be invalidated if the stock experiences a rebound above the upper boundary of the descending channel.