Fighting the SEC, Crypto Firm Gemini Picks New Chief of Finance

Dive briefs:

• Cryptocurrency exchange Gemini Trust Company LLC faces regulatory scrutiny and market turmoil stemming from the high-profile collapse of fellow exchange FTX, according to a Bloomberg report Friday. Appointed Skelton as Chief Financial Officer.
• The appointment comes several days after the Securities and Exchange Commission was indicted for selling unregistered securities to both Gemini and its service partner, Genesis Global Capital, through Gemini Earn, a cryptocurrency lending program. A week later. According to the complaint, the program had to be registered with the SEC because it “constitutes an offering and sale of securities under applicable law.”
• Genesis filed for Chapter 11 bankruptcy in early January and suspended withdrawals from its Gemini Earn program after facing the aftermath related to the collapse of crypto exchange FTX. According to the bankruptcy filing, the lender lists Gemini among its top 50 creditors, owing about $765 million to the exchange.

Dive Insight:

Skelton takes over Gemini’s financial helm after an exchange founded by Cameron and Tyler in 2015 Winklevoss, Industry Dive’s sister publication, Banking Dive, reported that the company’s president and CEO have each repeatedly cut staff since June.

Before joining the beleaguered cryptocurrency exchange, Skelton served as CFO of small business payments provider Till Payments for a year starting in January 2022, according to a LinkedIn profile. He has also held treasury roles at crypto insurance marketplace Nayms and crypto financial services provider Bakkt, and is an alumnus of payments firm Fiserv, where he served as director of e-commerce finance for three years.

According to a September 2022 press release, Gemini’s former chief financial officer, Jared Shaw, left the company last fall to take up the CFO position at cryptocurrency gaming platform Animoca Brands. Before joining Gemini in May 2019, according to his LinkedIn profile, he worked as a senior manager in financial services at big four accounting firm Ernst & Young, where he was a consultant, and Goldman, where he was a manager at Sachs Bank. Also a graduate.

Gemini did not respond to a request for comment.Bloomberg reported Friday that Skeleton’s hiring was confirmed to Bloomberg by a person familiar with the matter.

Genesis lent hundreds of millions of dollars FTX Affiliate Alameda Research, according to The Wall Street Journal.

Gemini and Genesis join several other crypto companies that have recently come under the spotlight of regulators. After his turbulent 2022, the industry as a whole is getting more attention from both financial and political institutions. The Financial Accounting Standards Board is gearing up for yet another vote on crypto accounting standards. For example, CFO Dive reported on Friday.

Investors in Gemini’s Earn Program have yet to recover their assets, according to the exchange, and those involved are still working toward a resolution. Gemini eventually terminated the program this month after he said he didn’t have enough liquidity to meet his withdrawal request in November, according to the SEC complaint.

At the time of the suspension, Genesis had approximately $900 million in assets from 340,000 investors in the Gemini Earn program, according to the SEC.

“Today’s charges build on our previous actions to make clear to markets and investors that cryptocurrency lending platforms and other intermediaries must comply with proven securities laws.” GaryChairman Gensler said in a statement. “Doing so is the best way to protect investors. It promotes confidence in the market. It’s not an option. It’s the law.”