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Ripple Lends Gemini $75M as SEC IPO Filing Shows Heavy Losses

7 hours ago
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TLDR:

  • Ripple agreed to extend Gemini a $75M credit facility, with terms expandable up to $150M, SEC filing shows.
  • Gemini’s IPO filing confirms borrowing limits in $5M tranches, offering flexibility as the exchange manages losses.
  • Part of the Ripple facility may be provided in RLUSD, highlighting its growing role in structured crypto financing.
  • Gemini confirmed heavy losses in its S-1 filing with the SEC as it prepares for Nasdaq listing under GEMI.

Gemini is pushing ahead with its public listing plans, even as financial losses weigh on the exchange. Ripple has stepped in with a sizable credit facility, giving Gemini breathing room as it heads toward its IPO. 

The filing reveals details of the deal, including flexible borrowing terms and the possibility of expansion. It also confirms that some of the credit may be provided in Ripple’s RLUSD. 

Together, these developments paint a picture of a firm navigating challenges while seeking fresh capital from public markets.

Ripple’s $75M Credit Deal with Gemini

According to Gemini’s SEC filing, Ripple has agreed to provide a $75 million revolving credit facility. The exchange can draw from the loan in $5 million increments, giving it control over how and when funds are used.

The filing also shows the credit line can expand up to $150 million if required. Ripple structured the deal to allow part of the loan in RLUSD, its stablecoin. That addition signals Ripple’s strategy of pushing RLUSD into wider use within structured financing agreements.

Crypto news outlet Coin Bureau reported on the arrangement, noting that the deal comes as Gemini faces mounting financial pressure. The exchange’s IPO documentation indicates losses that have grown over recent quarters. 

Ripple’s involvement provides short-term liquidity at a time when Gemini needs it most.

Market watchers have also pointed out the timing of the arrangement. With Gemini preparing for a Nasdaq debut under the ticker GEMI, the loan highlights its need for external support. 

Ripple’s financing deal is intended to help bridge that gap while the exchange pursues fresh capital from public investors.

Gemini IPO Filing Reveals Heavy Losses

Gemini filed its S-1 registration with the SEC, laying out its financials ahead of the proposed offering. The filing confirms that the exchange has been operating at a loss, though it did not provide a public market track record since it remains private.

The document states that Gemini plans to sell shares of Class A common stock on the Nasdaq Global Select Market. 

Founders Cameron and Tyler Winklevoss will retain control through Class B shares with ten votes per share. That structure ensures the brothers keep decision-making authority even after the IPO.

Financial analysts reviewing the filing highlighted the scale of Gemini’s losses. The exchange has been under pressure from increased competition, shrinking trading volumes, and regulatory costs. 

The credit facility from Ripple was presented in the filing as part of Gemini’s financing strategy to sustain operations through the listing process.

Gemini said the offering will proceed “as soon as practicable” once its registration is cleared. The listing would make Gemini one of the few major U.S.-based crypto exchanges to go public. 

The success of the IPO will likely depend on how investors view its ability to stabilize finances while scaling up in a crowded market.

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Source: https://blockonomi.com/ripple-lends-gemini-75m-as-sec-ipo-filing-shows-heavy-losses/