The crypto IPO market has experienced a dramatic slowdown as funding constraints and investor caution, not regulation, are delaying crypto IPOs, according to Christian Lopez, head of blockchain and digital assets at investment bank Cohen & Company Capital Markets. As per Lopez's analysis, capital has rotated from crypto into AI and other technology sectors, with recent volatility further reducing appetite for crypto IPOs. Macro uncertainty, including interest rate expectations and global deleveraging, is making investors reluctant to support newly listed crypto stocks. The market for crypto initial public offerings has slowed sharply, with several major crypto firms, including Kraken parent Payward, Ethereum app builder Consensys, wallet provider Ledger and asset manager Grayscale, all delaying IPO plans while waiting for markets to improve. Despite these headwinds, Lopez says regulatory clarity is no longer the primary obstacle for companies considering public listings, with companies going public before there was regulatory clarity.
Gemini's stock has experienced a dramatic 89% decline from its September 2025 debut, falling from its opening price of $37 to current levels near $4.19. This performance represents one of the steepest drops among recent crypto IPOs, with Circle (CRCL) down approximately 6% and BitGo (BTGO) sitting about 77% below its $22.43 first trade in January 2026. The broader crypto IPO market has struggled significantly, with Bullish (BLSH) having fallen roughly 71% from its $90 open and eToro (ETOR) trading near $41, down about 42% from its $69.69 debut. According to recent market data, the pattern spans every major crypto listing since mid-2025, with their slide tracking a broad market downturn that began in October. As per the latest analysis, this 89% drawdown in under a year is not a market fluctuation; it is a verdict on a set of assumptions, with the market grading crypto equities harshly on revenue durability - Circle sits at the defensible end with only 6% decline due to stablecoin float revenue being more durable than exchange or custody revenue.
Gemini's stock trading launch has created immediate market pressure, with GEMI shares falling 3.9% on Tuesday following the announcement. The stock decline reflects broader market concerns about the competitive landscape, as Coinbase dropped 2.4% and Robinhood fell 2.3% on the same day. According to market data, GEMI trades at $4.35, representing an 86% decline over the past year with a market cap of approximately $526 million. The stock performance reflects investor skepticism about the company's ability to successfully compete in the crowded zero-commission trading market dominated by established players like Robinhood and Coinbase. As per InvestingPro analysis, GEMI shares appear undervalued based on current trading levels despite achieving 39% revenue growth over the trailing twelve months. The latest analysis reveals that Gemini's collapse has produced the sector's first major post-IPO shareholder litigation, a suit over the company's post-listing strategy shift, highlighting the accountability shock that public companies face when pivoting in crypto markets.
As part of the stock trading rollout, Nasdaq has become Gemini's official provider of real-time market data, while Apex Clearing Corporation, a subsidiary of Apex Fintech Solutions, will handle custody and trade clearing services. According to the company announcement, Apex Clearing Corporation will execute, clear, and safeguard customer stock trades, providing the necessary regulatory infrastructure for the new service offering. This partnership structure allows Gemini to add equities without building the full clearing and custody stack internally, speeding up product launch while keeping key execution and post-trade functions in the hands of an established brokerage infrastructure provider. The platform obtained broker-dealer authorization from FINRA in 2022, subsequently modifying its registration to function as an introducing broker, enabling customer order routing for all NMS securities through Apex for trade execution and settlement.
According to Cameron Winklevoss, Gemini's co-founder and president, the company has over a decade of experience in building financial platforms and is expanding from crypto to stocks so that customers can manage their entire financial lives right from the Gemini app. As reported by the company, before introducing stock trading, Gemini had already expanded into prediction markets, derivatives, artificial intelligence tools, staking, custody services and credit cards as it looked to reduce its reliance on spot crypto trading. The business case is clear - crypto trading revenue can be cyclical, tied to asset prices, retail activity, and volatility, while adding stocks gives Gemini a product users already understand and may trade even when crypto markets are quiet, creating more chances to cross-sell services and deepen account relationships. At the company's annual meeting, shareholders re-elected six directors including Tyler and Cameron Winklevoss to serve until 2027. Despite near-term weakness in crypto funding markets, Lopez expects blockchain technology to continue gaining traction across traditional finance, with major financial institutions building blockchain-based infrastructure and preparing for tokenized settlement.
Gemini has updated its Financial Industry Regulatory Authority broker-dealer registration to operate as an introducing broker, allowing the company to introduce customer orders in National Market System securities while Apex executes, clears, and settles those trades. In April 2026, Gemini also secured a Derivatives Clearing Organization license from the CFTC, another crucial piece of the regulated platform infrastructure. However, Gemini has not disclosed how its stock trading business will be monetized, unlike other commission-free trading platforms that generate revenue through payment for order flow, interest earned on customer cash balances, margin lending, premium subscriptions or data licensing. In Q1 2026, Gemini posted an EPS of -$0.93, missing the forecasted -$0.61 by approximately 52%, while revenue came in at $50.27 million, up 42% year-over-year. The company remains unprofitable despite strong revenue growth, with analysts noting that Gemini may be undervalued at current price levels.
The crypto market faces significant consolidation ahead, with Lopez predicting that thousands of smaller cryptocurrencies are unlikely to survive over the next three to five years. As per Lopez's analysis, a lot of crypto companies trying to raise capital in the private markets are finding it difficult because of their singular focus on one product offering. Despite these challenges, the industry is moving toward near-instant settlement, shifting from T+1 to T+0, while initiatives such as the OpenUSD network are bringing together more than 140 financial institutions and payments companies around stablecoin infrastructure. While Lopez expects bitcoin, ether (ETH) and solana (SOL) along with a handful of other major tokens to remain important assets, he believes the long-term winners will be blockchain infrastructure providers rather than businesses built solely around individual cryptocurrencies. The market may not meaningfully reopen for crypto listings until next year, with Lopez noting that investors are hesitant to back a stock in an IPO because they're worried about whether there will be support in the aftermarket.
