Gemini Executives Insisting Everything’s Fine; BTC Inflow Data Shows Otherwise

Crypto firm Gemini is struggling after the recent regulatory actions against it. In a recent blog post, the company executives had to clarify that the other products and services of Gemini have no effect on customer withdrawals. Earlier it has put a halt on 900 million Earn program’s customers from withdrawing.

Nevertheless, a close examination of blockchain data reveals a recent slowdown in incoming bitcoin (BTC) transfers to Gemini from accounts at other exchanges, which analysts interpret as a possible indication that some crypto traders have grown more hesitant to send their assets to the primary platform.

According to on-chain statistics obtained from CryptoQuant, Gemini’s 30-day simple moving average (SMA) of BTC inflows has been between 100 and 200 BTC thus far in 2023, down from between 1,100 and 2,300 BTC about six months ago. The average fell to 106.5 BTC on January 8, the lowest level in over six years. It’s possible that Bitcoin investors are unaware that the yield-focused Earn programme is distinct from the exchange.

In a research released on January 3, CryptoQuant stated that “declining BTC inflows from other exchanges to any particular exchange could signal investors/traders regard that particular exchange as less desirable to have their coins on.”

In spite of the fact that the entire sector has been severely impacted by this dark crypto winter, Gemini has experienced a more dramatic decline in BTC inflows than other cryptocurrency exchanges.

The 30-day SMAs for BTC inflows at Kraken and Coinbase, for instance, are currently higher than their six-year lows. While Coinbase’s BTC transactions ranged from around 2,800 to 3,700 BTC in 2023, Kraken’s incoming BTC transfers varied from 700 and 1,030 BTC. According to CryptoQuant, the amount of bitcoin that has entered Kraken and Coinbase this month has increased by 42.5% and 30.5, respectively.

A separate withdrawal freeze at the cryptocurrency loan and trading company Genesis, a division of the blockchain giant Digital Currency Group, is what Gemini executives blame for the withdrawal freeze at the Earn programme. Customers would receive a yield on their deposits under the terms of Earn. After receiving the deposits from Gemini, Genesis agreed to invest them for interest. Genesis then transferred the funds back to Gemini.

But when Genesis ran into financial trouble, it stopped allowing withdrawals, causing Gemini to stop accepting new clients.

In addition to sparking a Twitter spat between CEO of DCG Barry Silbert and Cameron Winklevoss over the issue, the failed business deal has now led to a lawsuit from the U.S. Securities and Exchange Commission.

Andrew is a blockchain developer who developed his interest in cryptocurrencies while his post-graduation. He is a keen observer of details and shares his passion for writing along with being a developer. His backend knowledge about blockchain helps him give a unique perspective to his writing