Total revenue rose 37% year-over-year to $45.5 million, but the headline figure masks a severe deterioration in the company's core business. Exchange transaction revenue fell 38% to $12.5 million, and total trading volume collapsed to $3.8 billion from $11.3 billion in the same quarter last year, a drop of roughly two-thirds. GEMI shares were trading around $4.07 on Wednesday, down approximately 85% from its $28 IPO price. The stock surged more than 40% on its September 2025 debut day before the slide began, meaning investors who bought near that post-debut high have seen losses closer to 90%.

Goldman Sachs downgraded the stock to Sell, pointing to a "challenging profitability path."

Services Revenue Carries the Quarter

The revenue growth that did occur came almost entirely from non-trading segments. Services revenue jumped 149% year-over-year to $23.5 million. Credit card revenue was the largest contributor, rising 231% to $16.2 million. Staking revenue, which involves earning rewards by locking up cryptocurrency on behalf of customers, climbed 50% to $4 million. Over-the-counter trading revenue surged from $0.6 million to $4.7 million, a gain of 683% and the largest proportional increase across all revenue segments in the quarter.

These figures suggest Gemini is successfully shifting revenue away from spot trading, though the absolute numbers remain small relative to its operating costs. Total operating expenses came in at $122.4 million for the quarter, down 15% from $144.5 million in Q1 2026, following a restructuring earlier in the year that cut the workforce by roughly 30%, from approximately 640 to 445 employees, and included the departures of the company's Chief Operating Officer, Chief Financial Officer, and Chief Legal Officer.

CEO Tyler Winklevoss acknowledged the ongoing challenge in a statement accompanying the results. "Despite crypto market headwinds, we're making significant strides towards building a more resilient company by developing multiple paths to revenue that are less sensitive to crypto market forces," he said. He added separately that "we still have work to do." President Cameron Winklevoss said the company is "providing more ways than ever for customers to interact with our platform."

Prediction Markets: Early Growth, Modest Revenue

One of Gemini's most closely watched strategic bets is its prediction markets platform, launched in December 2025 under a Commodity Futures Trading Commission license as a Designated Contract Market. In April 2026, the company also received a Derivatives Clearing Organization license, allowing it to clear and settle its own event contracts without a third-party intermediary. Trading volume in that segment rose 93% quarter-over-quarter, with record monthly volumes in every month of Q2. Cumulative contracts traded have now exceeded 225 million since launch.

Revenue from prediction markets was $0.5 million in Q2, up from $0.4 million in Q1. That figure is small relative to competitors: Kalshi processes over $1 billion annually, Polymarket over $2 billion, and Hyperliquid has established a significant footprint in decentralized derivatives. All of this takes place inside a market that recorded $63.5 billion in total volume during 2025. Gemini is entering a crowded space from behind, though its CFTC-licensed status may offer advantages in regulated jurisdictions where decentralized platforms face restrictions.

In July 2026, Gemini also launched commission-free stock trading, and its derivatives clearinghouse went live on August 4. The company is clearly widening its product surface, but Goldman Sachs, at minimum, remains skeptical that new offerings can close a gap of this size quickly enough.

What This Means Outside the United States

Gemini's trajectory is largely a domestic story at this point. The company exited the United Kingdom, European Economic Area, and Australia retail markets in April 2026, concentrating its expansion entirely within the United States.

For users in South Asia and Africa, the direct impact is limited but the broader signal is worth noting. In India, prediction markets face an outright regulatory ban under the Promotion and Regulation of Online Gaming Act 2025. The government has already ordered internet service providers to block Polymarket, with Kalshi potentially next. Gemini does not serve Indian retail users, meaning its prediction market expansion offers no near-term pathway for one of the world's largest potential audiences, a market already burdened by a 30% flat tax on crypto gains and a 1% transaction levy. That regulatory pressure has prompted a number of Indian crypto startups to relocate to more permissive hubs such as Dubai and Singapore.

Across Africa, Gemini operates only in Egypt, Ghana, and South Africa, leaving out Nigeria and Kenya, the continent's two highest-volume crypto markets. Nigeria alone sees peer-to-peer crypto trading volumes exceeding $2.4 billion per month; Kenya records more than $900 million in monthly peer-to-peer volume. The exchanges that serve those users, including Yellow Card and Binance's peer-to-peer network, operate with mobile-first, low-fee models better suited to local conditions. Gemini's U.S.-centric rebuild offers no obvious entry point for those markets. Notably, Sub-Saharan Africa has not yet seen formal regulatory action against prediction markets at the scale observed in India, leaving the region as a potential future opportunity if the company eventually resumes international expansion.

Looking Ahead

Gemini posted a full-year 2025 net loss of $585 million and cut roughly 30% of its workforce earlier this year. The Q2 2026 results show a company that is losing money more slowly: the $107.7 million quarterly net loss compares with a $133.2 million net loss in Q2 2025, a year-over-year improvement of roughly 19%. The company is also diversifying its revenue base, but has not yet demonstrated a credible timeline to profitability.

Monthly transacting users grew 11% to 580,000, but assets held on the platform fell to $8.4 billion from $18.2 billion a year ago, largely due to lower crypto valuations across the board.

With a market capitalization now sitting around $515 million, down from approximately $3 billion at the time of its IPO, and shareholder litigation pending over alleged inadequate IPO disclosures about its strategic pivot toward prediction markets, the next two quarters will test whether the product expansion underway can translate into a fundamentally different financial picture.