Gemini exchange shuts down OTC accounts over GUSD redemptions

05 Feb, 2019 | Updated: 05 Feb, 2019
by Joeri Cant
News
Gemini exchange shuts down OTC accounts over GUSD redemptions

Several over-the-counter trading desks claim that Gemini, the cryptocurrency exchange founded by the Winklevoss twins, abruptly closed their accounts after the exchange learned that the OTC traders planned to redeem several million dollars of GUSD.

According to email correspondence obtained by CoinDesk, one OTC trader informed Gemini that he planned to redeem several million dollars of GUSD, and once he had done so, the exhange closed his accounts without any explanation.

Gemini said in a later statement to the trader that a review determined his account must be closed and that it was not able to elaborate on the specifics for this decision.

It was further reported that a major cryptocurrency exchange, who as well wished to remain anonymous, attested to the desk’s professionalism and good standing.

The in Latin America-based OTC desk, who obtained GUSD through its own network, was apparantly warned by Gemini staff that redeeming millions of dollars would harm the stablecoin.

Read more: Gemini Completes SOC 2 Review - now offers increased security compliance

Another OTC desk, based in the US this time, said that its Gemini account was closed down, days after the desk redeemed several million GUSD.

This trader is now convinced this was part of Gemini’s strategy to 'maximize their status on CoinMarketCap.'

Several OTC traders with an active Gemini account said they are reluctant to redeem GUSD for fear of jeopardizing their accounts.

'So many players are unable to redeem, even very, very big OTC desks. Having an account doesn’t guarantee redeemability', one trader said.

Is Gemini closing OTC accounts to manipulate its marketcap? What do you think? Let us know in the poll below.

This is a developing story. Chepicap will keep you updated.

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