ANU research shows Australia’s second-largest bitcoin trader, Gemini, is warning of a “massive” market collapse in the next three months, as it begins to recover from a severe outage last year.
Key points:Gemini’s Mark Coker says he expects a “significant” reduction in trading volume in the second half of 2018Gemina is the largest market maker in the digital currency marketSource: ANU article Gemini is the second-biggest market maker, behind Bitstamp, in the bitcoin market, and Coker is among a number of analysts who believe it is facing a significant decline in its trading volume over the coming months.
Geminatek, the company which owns Gemini, says it will take the lead in a number a major new developments over the next several months, including: “the launch of the first ever bitcoin futures contract” and “new bitcoin ETFs”, and the introduction of a trading platform which will allow investors to sell bitcoin directly to their own wallets.
Key Points:Geminus market is up by about 30% in the past yearMark Coker, Gemini’s chief financial officer, said the bitcoin trading volume is down around 20% over the past 12 months, but it is expected to rebound over the yearGeminus said the decline in volume is “largely driven by an increase in market share from other players”.
“We have seen the market go down by about 25% since June last year,” he said.
“This is primarily driven by a large increase in bitcoin-related trading volume from other market players and a decline in market capitalisation.”
There is a significant and growing volume of activity, and the number of transactions is growing at a rapid pace, although the volume of transactions are down a lot.
“It is a very challenging time to be in bitcoin trading.”‘
Big change’ for the digital currencies sectorGembin said it was “very concerned” about the market collapse, which occurred in mid-2016.
“In the past two years, we’ve had several market crashes, and there has been a large impact on our business and our financial position,” it said.
Geminis management, including Coker and the other principals, have “finally come together” and agreed to implement a plan to reduce volatility and prevent a further market decline.
“We will implement a comprehensive plan to address the market decline over the course of 2018,” Gemini said in a statement.
“The plan includes a number the key initiatives outlined above.”
Geminy will provide a range of services for traders to manage their own portfolios and exchange rates, including the Gemini MarketWatch platform, which will enable investors to trade in both bitcoin and fiat currencies.
It said it would be launching a new trading platform to allow investors “to trade in their own assets directly to a portfolio”.
Geminas market capitalization currently stands at $1.1 billion, with approximately $2.5 million in digital currencies.
Gimini has also been the biggest provider of bitcoin futures contracts, with its futures market currently trading at $9.1 million.
Gemeinis share price has risen to about $1,400, up from $850 last year, and it is believed to be up by more than 30% over that time.
Gems founder and COO, Mark Cogan, said he was pleased with Gemini’s latest development.
“I am really happy to see the Gemini team is finally taking the lead on this, because it has been quite a challenge for them to maintain such an extraordinary level of market share,” he told AAP.
“They have been working very hard to achieve this and I’m pleased they have finally achieved that milestone.”
At Gemini, we have always been a leader in the industry and I am very confident they will continue to grow and deliver the best service for bitcoin traders around the world.