COO talks what sets it apart

00:00 Speaker A

Well, it’s been a big week for IPOs. Cryptocurrency firm Gemini is among them, going public on the Nasdaq today. It’s set to trade under the ticker GEMI after raising $425 million in that offering. The stocks expected to start trading $28 a share is where they sold those shares. Joining me now, Marshall Beard, Chief Operating Officer at Gemini. Marshall, congrats. Thanks for being here.

00:31 Marshall Beard

Thank you so much for having me.

00:33 Speaker A

Well, as we just mentioned, it has been a busy week for IPOs and in particular sort of crypto and Fintech IPOs have been seemingly the most popular and most visible this year. For people who are watching, who are interested in Gemini and I know you guys made a big pitch to retail investors in particular. How is Gemini different than some of the offerings that are out there on the market?

01:03 Marshall Beard

Sure. Yeah, I mean, Gemini, you know, we launched over 10 years ago and we’ve built this uh full stack crypto native platform that services both retail customers and institutional customers, anything from buying $100 worth of Bitcoin to a hedge fund that’s trading, you know, hundreds of millions of dollars of volume. So, we’ve built a really great, uh incredible experience for all types of customers, uh, to enter their crypto journey.

01:34 Speaker A

Um, and as you mentioned, you have a wide swath of customers and you also offer a lot of different things, right? So, you’ve got a stable coin, you’ve got crypto staking, you guys even have a credit card that offers rewards in crypto. You offer custodying. Um, what is the, the revenue breakdown? I mean, talk to people about how you make money, right? And what the biggest sources of revenue across those different business lines are?

02:04 Marshall Beard

Sure. So, um, you’re right in that we offer a wide suite of products and services to our customers. We think of ourselves as a platform more so than an exchange and custodian and we kind of see this future of like a super app as we move financial markets on chain, which is the ultimate goal of of our business in our industry. Um, and then like

02:40 Marshall Beard

so within our kind of product stack, uh, we make the majority of our revenue still from transaction fees. These are folks that trade on our exchange. We offer a UX like a brokerage, but we also offer uh the order book directly itself too. So we match buyers and sellers and we earn transaction fees off that. Below that, you know, our biggest, um, you know, product lines are our credit card, our custodian and our staking business.

03:04 Speaker A

Um and I guess again, going back to sort of going back to the first question then, if the biggest part of the business is that exchange business, the trading business, there’s a lot of places to trade crypto right now. You got your Coinbases, you got your Robinhoods, you know, there are a lot of choices. How why do people choose you guys rather than some of those other competitors?

03:29 Marshall Beard

Sure. Um, you know, we’ve been doing this for a long time. We’ve built uh incredible technology. Uh we’ve built an incredible brand. Uh we offer great depth and spreads and liquidity for people to uh buy and sell crypto really easy. We have an incredible UX, we make we take the complexity of crypto kind of out of the experience so that anyone can use it. And uh we’ll continue to do that. We, you know, our plan is to bring as many people uh into the crypto ecosystem as possible.

03:57 Speaker A

Um you mentioned, we talked a little bit about that revenue breakdown, where you guys are getting the money. I’m also curious about profitability. You guys um you know, not unusually for an IPO, um although perhaps more unusually for a company that’s been around as you say for 10 years, you guys don’t make money yet, right? In the first um six months of the year, I I believe it was, you lost $282.5 million. What’s that trajectory for profitability for you guys?

04:30 Marshall Beard

Sure. Um you know, look, we’re focused on the future. We’re in an incredible place right now. Our credit card product is seeing a an inflection point of growth. Uh so we look forward to kind of building on our existing suite, building our geographic expansion. We’re expanding into Europe, we’re expanding through Asia Pacific. Uh and we’ll continue to focus on growing our business lines and growing our customer base.

04:59 Speaker A

Um how tied are Gemini’s fortunes to cryptocurrency prices? And what do you forecast for the likes of say, let’s just take Bitcoin as the example since it’s the biggest one.

05:15 Marshall Beard

Sure. Um our our our business isn’t too tied to prices. I mean, we we, you know, we’re an exchange and so volatility is generally healthy for our marketplace and for our financials as well. Um so, you know, we like volatility. I think we generally like volatility up and to the right. Um and that’s kind of, you know, our core our core business there. Um I don’t have a price target. I I I think our founders, Cameron and Tyler, um have penned a piece equating uh Bitcoin, um in the 21 million bitcoins to the above ground value of gold. And I think if you do that math nowadays with the value of gold, you’re looking at $1 million of Bitcoin.

06:10 Speaker A

Yeah, I those have definitely been some forecasts that have been out there and gold, gold itself has done quite well uh this year, we should point out as well. Um, and you know, as I mentioned, you guys um are definitely catering uh and courting a retail in uh audience as investors in the company as well. What kind of, what have you been hearing from them? Like as you guys have been doing your road show and you’re talking to retail investors, what has that interaction been like?

06:46 Marshall Beard

Yeah, people are excited. Um, you know, I don’t think we’re in this uh massive bull market right now, but the market sentiment is incredible. Um I think with the, you know, um regulatory landscape, especially here in the United States being very positive for the crypto industry. Folks are excited. Folks are building projects again, they’re launching new things, more people are coming into the industry. We’re seeing incredible talent joint places like Gemini and people are just excited. Um, you know, we have the genius bill that passed. We we believe there’s Clarity Bill is coming soon. Uh the SEC and CFTC are are pro crypto. And so it’s just exciting. Everyone’s excited, um and we look forward, you know, to see this through the rest of the year.

07:33 Speaker A

Marshall, thanks so much. Congrats again.

07:37 Marshall Beard

Thank you so much.