Gemini is entering one of the fastest-growing sectors in digital finance after securing regulatory approval to operate prediction markets in the United States. The move triggered a sharp rally in the exchange’s publicly traded shares, which rose nearly 14% in after-hours trading as investors positioned for a potential new revenue engine.
The approval marks a turning point for Gemini, which has struggled in public markets amid broader weakness in crypto trading activity. Analysts say the license could give the firm a strategic foothold in a sector attracting both retail speculation and institutional attention.
CFTC Greenlights Gemini Titan to Operate as a Designated Contract Market
Gemini said Wednesday that its affiliate, Gemini Titan, received a Designated Contract Market (DCM) license from the Commodity Futures Trading Commission a classification typically reserved for regulated futures and options exchanges.
The designation allows the company to list event contracts, opening the door for U.S. users to trade outcomes tied to real-world events such as sports, elections, economic data releases and geopolitical developments.
The platform will also expand into crypto futures, options and perpetual contracts, strengthening Gemini’s domestic derivatives presence in a market historically dominated by offshore exchanges such as Binance and Bybit.
CEO Tyler Winklevoss described the approval as the end of a “five-year licensing process,” noting the firm initially filed its application in March 2020.
Gemini Shares Rally After Months of Heavy Losses
Gemini’s stock (GEMI) surged 13.7% to $12.92 in after-hours trading following the announcement. The reaction stands in contrast to the stock’s performance since its Sept. 12 public debut, with GEMI down 64.5% amid shrinking exchange volumes and a broader slowdown in retail activity.
Analysts say the new revenue vertical one structurally decoupled from spot crypto volumes could help diversify Gemini’s business model.
President Cameron Winklevoss said prediction markets could eventually rival traditional capital markets in scale, calling them “as big or bigger” over time.
Prediction Markets Enter Mainstream Spotlight
The move comes as prediction markets rapidly gain traction across both Web3 and regulated financial platforms. November saw record monthly volumes for Polymarket and Kalshi, while Kalshi recently closed a $1 billion funding round at an $11 billion valuation, underscoring institutional confidence in the sector.
Prediction markets allow traders to express views on probabilistic outcomes, from elections to macroeconomic indicators, creating real-time forecasting tools that often outperform traditional polls.
However, the space remains controversial. Multiple U.S. states have taken enforcement actions against CFTC-regulated event-contract platforms, arguing that certain markets resemble unlicensed sports betting.
Despite the scrutiny, major industry players continue to expand. Trust Wallet recently launched its own prediction module, and Coinbase appears to be preparing a platform backed by Kalshi, based on website materials discovered earlier this month.
Gemini Builds Toward a Multi-Product “Super App” Strategy
The prediction markets rollout is part of Gemini’s broader effort to evolve into a multi-product financial “super app”, integrating trading, derivatives, payments, yield products and now event contracts.
The strategy reflects increasing pressure on crypto exchanges to diversify revenue sources as trading volumes shift to ETFs, offshore markets, and automated liquidity venues.
Gemini reported quarterly losses after going public, attributing the results to listing-related expenses. Executives said expanding into regulated prediction markets could help restore growth momentum.
With the new CFTC license, Gemini becomes one of the few U.S. crypto firms positioned to operate prediction markets at scale — a sector many now view as one of the most promising intersections of crypto, retail speculation and real-time financial intelligence.
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