[senkora]

The draw of Gemini was always that it was a New York-regulated crypto exchange that presented as similar to traditional exchanges.

For institutional traders, they even provide a standard FIX API over cross-connect in the NY5 data center in New Jersey. This is something that institutions understand how to connect to and work with.

(In contrast, most crypto exchanges have/had highly bespoke systems of questionable quality)

https://docs.gemini.com/fix-marketdata/

So the Gemini Earn thing has always confused me. If your entire shtick is legitimacy and being subject to competent regulation, then why would you release a product like that?

I guess I’ll have to attribute it to the reality-distortion field of the crypto hype. They must have actually believed that either 1) the product was sound or 2) they would avoid the fallout when it exploded.

[JumpCrisscross]

> If your entire shtick is legitimacy and being subject to competent regulation, then why would you release a product like that?

We call it greed, but it’s a consistent feature of trusted institutions being tempted to sell out that brand for short-term gains.

My hypothesis is the trusted market is efficient, and so tends towards consolidation and low margins. The untrusted market is more cottage-like, with small players and large margins. If you’re an institution, it’s tempting to try that high-margin field, leveraging your trusted brand for scale.

[I_Am_Nous]

Perhaps it was a case of middle ground - they believed they had enough runway to make an exit before serious fallout because they believed the product would attract enough gains to pay out to Earn users. The market was revealed to be very "smoke and mirrors" so whether Earn was going to last long or not, it was built during a bubble cycle and didn't survive the correction.

[CityOfThrowaway]

The best explanation I have is that during 2021 the US government looked pretty weak and a lot of companies forgot laws exist.

[15457345234]

Definitely a whole lot of very weird things happened during the pandemic that people are going to have a very hard time explaining when questioned.

And they will be questioned.

[wmf]

I suspect they weren't making any money because there's no profit in legitimate crypto trading so in desperation they branched out.