Gemini sued as stock drops 80% after pivot
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- Gemini is being sued in a proposed class-action lawsuit filed in Manhattan federal court by shareholders alleging deception about its post‑IPO strategy.
- Gemini's September IPO priced shares at $28, briefly rose to $40, then fell over 80% to around $6, hitting a low of $5.82 on Feb 20.
- Gemini announced in early February a pivot to a prediction‑market‑centric model called “Gemini 2.0,” cutting 25% of staff and exiting EU, UK, and Australian markets.
- Gemini’s chief financial officer, chief operations officer, and chief legal officer all left the company in February as operating expenses rose roughly 40%.
- Gemini reported Q4 revenue of $60.3 million, a 39% year‑on‑year increase, beating analysts’ $51.7 million expectation.
- Plaintiff Marc Methvin claims the IPO documents misrepresented Gemini’s core product and that investors suffered losses when the stock fell to a low of $5.82 on Feb 20.
Why it matters: Shareholders who bought Gemini at IPO prices lose as the stock’s 80% plunge erodes their investments, while the lawsuit could force the company to compensate them and potentially halt its prediction‑market strategy, reshaping its business model and market perception and regulatory scrutiny.
