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A US regulator has granted Gemini permission to offer prediction markets. Gemini, an American crypto exchange founded by the Winklevoss brothers Tyler and Cameron, allows users to buy, sell, and store crypto on its platform and is known for its strict adherence to regulations. In a statement on Wednesday, Gemini said the approval paves the way for a new financial service in a market that has previously lacked clarity.
Why Gemini’s Move is Important for the Sector #
Prediction markets allow users to make predictions on events through contracts that pay out if a prediction comes true. These products fall under strict regulations in the United States. The decision to admit Gemini to this market shows that regulators are providing more clarity on what is permitted. This gives companies greater certainty when developing new services.
The assessment focused on risks such as fraud, market manipulation, and user protection. Gemini had to demonstrate that transactions are executed securely and transparently. With this step, the company gains a head start in a market that has remained largely closed to US exchanges. Other providers are expected to follow this process, as it provides guidance for future applications.
What the Regulator Exactly Approved #
The approval specifically targets contracts that allow users to predict predefined outcomes. The regulator will oversee how these contracts are processed and how risks are mitigated. The decision confirms that these services fit within existing legislation, provided that providers use clear processes for security and oversight.
The approval means Gemini carries more responsibility. The company must remain transparent about risks and reporting. These requirements apply to all providers of new financial products.
Stock Price Reaction to the Gemini News #
Gemini’s stock rose in after-hours trading on Wednesday following the news that the company can offer prediction markets. Investors view the approval as a significant step for the platform.
The stock had been under pressure since its IPO due to weakness in the crypto market. The increase shows that greater clarity from regulators has an impact on confidence in companies introducing new services.