Form S-1
Please supplementally provide us with copies of all written communications, as defined in Rule 405 under the Securities Act, that you, or anyone authorized to do so on your behalf, present to potential investors in reliance on Section 5(d) of the Securities Act, whether or not they retain copies of the communications.Rest of the question
Please contact the staff member associated with the review of this submission to discuss how to submit the materials, if any, to us for our review. Please describe in greater detail in the forefront of your prospectus your use of digital engagement practices in connection with your platform, including, as examples only, behavioral prompts, differential marketing, game-like features and other design elements or features designed to engage with retail investors. In this regard, please 2. expand on your disclosure at page 4 regarding your use of user data, which allows for “ongoing platform optimization through tailored product development and an overall more engaging experience for users.” Please also address the following, without limitation, in your revised disclosure: • Specifically describe the analytical and technological tools and methods you use in connection with such practices and your use of technology to develop and provide investment education tools. • Clarify whether any of such practices encourage retail investors to trade more often, invest in different crypto assets, or change investment strategies. About This Prospectus Market, Industry, and Other Data, page iii 3. We note your statements that you have not independently verified the market and industry data obtained from various third-party sources and that the accuracy and completeness of the information cannot be guaranteed. As it is not appropriate for the company to directly or indirectly disclaim liability for information in the registration statement, please remove such disclosure or include a sentence specifically confirming that you are responsible for all disclosures in the registration statement. Prospectus Summary, page 1 4. Please provide an organizational chart outlining your corporate structure and illustrating the relationships of the various entities discussed throughout the filing, including those disclosed on page 123 under the "Government Regulations" heading. Risk Factors A significant amount of the trading volume on our platform..., page 18 5. You disclose that a relatively small number of institutional market makers and hightransaction volume users account for a significant amount of the trading volume on your platform. Please revise to quantify the amount of trading volume on your platform that is accounted for by institutional market makers and high-transaction volume users. To the extent your business and results are materially dependent on any of these customers, please identify them. Our failure to safeguard and manage our and our users' fiat currencies..., page 20 6. We note that the third paragraph of this risk factor makes reference to your "hot and cold wallet and storage systems." Please revise to disclose the amount or percentage of your and your customers’ crypto assets that are held in hot wallets. We are leveraging AI technologies in the development..., page 33 We note your disclosure that you currently use machine learning and artificial intelligence to improve your products and processes. In an appropriate section of the prospectus, please provide a materially complete discussion regarding your artificial intelligence and machine learning capabilities, and how they operate. In addition, clarify what datasets your artificial intelligence or algorithms use. Further, 7. please revise to provide a more complete description of how you utilize artificial intelligence in your business. We hold certain investments in various crypto assets and may suffer losses, page 38 8. We note your disclosure that you hold investments in a number of crypto assets. To the extent material to understanding the risks you face, please identify any material exchange or third-party custodian you use and describe the terms of any material agreements with those entities. A temporary or permanent blockchain fork to any supported digital asset..., page 40 9. You disclose that you do not guarantee that you will support any fork or provide the benefit of any forked crypto asset to your users. Please describe the criteria you use in determining whether to support forked crypto assets. Also, please explain the potential impact of such determinations on your customers. A particular digital asset, digital asset transaction, or product or service offering's status as a security..., page 45 10. We note your statement in the risk factor heading that, “[i]f we incorrectly conclude that a digital asset, digital asset transaction, or product or service offering is not a security or securities transaction….” Please revise this sentence to add after the phrase “is not” the phrase “offered and sold as.” Also, please revise the body of this risk factor to address the substance of this comment. Any failure to obtain or maintain necessary money transmission registrations..., page 56 11. We note your disclosure that in the U.S., you operate though your U.S. exchanges, Gemini Trust Company, LLC and Gemini Moonbase, LLC. In an appropriate section of the prospectus, please revise to clarify the difference between these two exchanges and the respective entities they operate through. Unaudited Pro Forma Condensed Consolidated Financial Data, page 86 12. We note your disclosure in the third paragraph, that you adjusted the pro forma financial data to give effect to events that are directly attributable to the Transactions, are factually supportable and, with respect to the consolidated statements of operations data, are expected to have a continuing impact on Gemini. Your disclosure appears to reference guidance in Article 11 of Regulation S-X prior to its amendment in 2020. Please disclose how you considered Item 11-02(a)(6)(i) in determining your transaction accounting adjustments. Management's Discussion and Analysis of Financial Condition and Results of Operations Key Business Metrics Adjusted EBITDA, page 91 13. In the table on page 92, please reconcile for us the amount of stock based compensation of $25,848 to the amount of stock based compensation in your statement of cash flows of $15,840 on page F-5 and make any necessary changes in the disclosure. Staking Revenue, page 94 14. We note your disclosure that in connection with your staking services, you earn an agent fee that is denominated in crypto assets. Please tell us, with a view toward revised disclosure, whether you also accept crypto assets as payment for any other fees (e.g., transaction fees, custody fees, etc.). If so, please disclose the crypto assets that you accept as payment, how and when you value the crypto assets accepted as payment, your policies related to monetizing the crypto assets and where you exchange the crypto assets for fiat currency. To the extent you have agreements with any third parties used to exchange your crypto assets, please disclose the material terms of the agreements. Also, please clarify which party is responsible for paying any transaction fees associated with transferring the crypto assets to you, to the extent applicable. Critical Accounting Policies and Estimates, page 100 15. We note your disclosure of critical accounting estimates. Please include qualitative and quantitative information necessary to understand the estimation uncertainty and the impact your critical accounting estimates have had or are reasonably likely to have on your financial condition and results of operations. Your disclosure should explain why each critical accounting estimate is subject to uncertainty and, to the extent the information is material and reasonably available, discuss how much each estimate and/or assumption has changed over a relevant period and the sensitivity of reported amounts to the underlying methods, assumptions and estimates used, to the extent applicable. The disclosures should supplement, not duplicate, the description of accounting policies or other disclosures in the notes to the financial statements. Refer to Item 303(b)(3) of Regulation S-K and SEC Release No. 33-10890. Quantitative and Qualitative Disclosures about Market Risk, page 104 16. Please tell us how you considered interest rate risk. Also, tell us why you have not provided quantitative information. Refer to Item 305(a)(1) of Regulation S-K. Business, page 106 17. We note your disclosure on page 89 that as of December 31, 2024, you support over 80 crypto assets for trading on your exchanges and over 160 crypto assets for custody on your platform including bitcoin, ether, and other assets on a variety of blockchains. Please expand your disclosure in this section to provide more details on the types of crypto assets and services you support on your platform and your standards for inclusion for such assets or services. 18. Please revise this section to clarify the extent to which you currently have international operations and disclose the foreign jurisdictions in which you offer your services and access to your platform. In this regard, we note your disclosure at page 123 regarding the exchanges you operate in the United Kingdom and Europe. We note your disclosure on page 69 that your "officers, directors, employees, and large stockholders may encounter potential conflicts of interests with respect to their positions or interests in certain digital assets, entities, and other initiatives," which could adversely affect your business and reputation. Please revise to describe any 19. policies and procedures that are in place to prevent self-dealing and other potential conflicts of interest. We also note your disclosure on page 20 that while you take steps to segregate your assets from user assets, failure to properly safeguard, manage, or account for these funds could result in financial losses, regulatory scrutiny, reputational harm, or legal liability. Please describe any policies and procedures you have regarding the commingling of assets, including customer assets, your assets, and those of affiliates or others. Increasing Monthly Transacting Users, page 112 20. On page 112, in the bullet titled "Acquire new and retain existing institutional users," we note your disclosure that you are "expanding [your] strategic distribution partnerships with companies like VanEck." Please expand your disclosure to briefly describe the nature of any material strategic distribution partnerships and the terms thereof. Increasing the Number of Assets Available on Our Platform, page 112 21. We note that you actively evaluate and list for support new crypto assets for trading, as well as for staking and custody. Please describe the steps to approve new crypto assets for support on your platform, including the commercial, legal, and technical considerations given when making such a determination. Expanding and Engaging Our User Base, page 114 22. Please revise your disclosure in the bullet titled "International Growth" on page 114 to clarify your plans to expand operations into Europe and APAC, including the time frame and any factors you consider in determining whether to expand in any particular country. Our Products and Services, page 115 23. We refer to your disclosure in the bullet titled "Exchange" on page 115. Please revise your disclosure to describe in greater detail how crypto asset trading works through your platform. Please describe, for example, how your matching service for customers executing transactions on your platform operates. 24. We refer to your disclosure in the bullet titled "Stablecoin" on page 117. To the extent you have investment policy guidelines for the GUSD reserves, please summarize the policies, including those pursuant to any regulatory requirements imposed by NYDFS. Also, please disclose which persons within Gemini oversee the reserve investment policy and discuss how such policies may be modified. 25. On page 117, please revise your disclosure in the bullet titled "Staking" to describe in greater detail the terms of the staking program, including the difference between Staking and Staking Pro (as referenced on Gemini's website), and how users may earn rewards. Please quantify the agent fees you earn for introducing customers to the staking pool, as referenced on page 94. Further, please identify the countries where your customers may participate in staking activities. In this regard, we note your disclosure on page 94 that your staking services are available to customers in "select geographies." 26. Please revise your disclosure in the bullet titled "Collect" on page 118 to describe your process for approving NFTs for listing on your NFT marketplace and what role you play in price discovery or other disclosure regarding the particular NFTs that are traded. 27. On page 118, please expand your disclosure in (i) the bullet titled "Transaction Fees" to quantify the transaction fees you earn from your OTC trading platform and (ii) the bullet titled "Withdrawal Fees" to quantify the withdrawal fees you earn when users withdraw fiat via wire or crypto assets from the platform. Consolidated Statement of Cash Flows, page F-5 28. Please disclose how you determine the classification of the additions and dispositions of your crypto assets between operating or investing activities. 29. If true, please revise the caption Custodial funds due to customers to clearly indicate that it reflects deposits net of redemptions. Note 2. Summary of Significant Accounting Policies Accounts receivable, net, page F-10 30. Please expand your disclosure to include a discussion of the following related to your credit card product: • Include a discussion of how you account for any commitments or guarantees related to the credit card product with references to the related authoritative accounting literature (e.g. ASC Topic 460). • Include a discussion of the related rewards program associated with your credit card product and how you account for any rewards offered. • Include a discussion of the fees earned on the credit card program including a discussion of how the fees are allocated between you and the issuing bank. Crypto assets pledged, page F-12 31. We note your disclosure that crypto assets pledged are carried at fair value consistent with all other crypto assets held by the Company. We further note that the Lender has the right to sell, transfer or rehypothecate the pledged assets. Given it appears the Lender has acquired control of the pledged assets, please explain to us how you determined the assets should continue to be recognized on your balance sheet. In your response, tell us how you considered whether the pledge of collateral to the Lender should be accounted for as a receivable with an embedded derivative. Related party loans and convertible notes Related party loans, page F-13 32. With respect to your related party loans, please revise your disclosure to clarify whether you have control of the loaned crypto assets (e.g. are able to sell, pledge or rehypothecate the assets). To the extent you determined you were able to control the assets at loan origination, please explain why you were required to obtain permission from WCF in March 2023 to use a portion of the loaned assets as collateral for third party loans (as disclosed in note 12 to your financial statements). Stock-based compensation, page F-15 33. Please reconcile, and revise as necessary, the number of Common Units authorized for issuance under Gemini LLC’s operating agreement of 44,843,146 Common Units on page 102 and 28,763,146 Common Units on page F-15. Note 3. Revenue Revenue recognition, page F-20 34. Please revise your disaggregated revenue table to disclose revenue from customers separately from other sources of revenue. Reference is made to ASC Topic 606-1050-4. Transaction revenue, page F-20 35. With respect to your fee calculation, you disclose that you charge a fee at the transaction level that is calculated based on a percentage of order volume and varies depending on the value of the transaction and/or the customer’s transaction volume processed over the previous thirty-day period. Please tell us more about how you calculate the amount of your transaction exchange revenues. Please provide an example of a typical fee calculation in your response. 36. Please explain to us how instant orders are fulfilled. In your response, clarify for us whether company inventory is used to satisfy these orders. Interest income and corporate interest and other income, page F-21 37. Please expand your disclosure to include a discussion of the method you use for recognition of interest income. Note 6. Crypto Assets Held, page F-26 38. Please include a description of the nature of activities that result in additions and dispositions of crypto assets. Refer to ASC 350-60-50-4. Provide to us information that reconciles (i) the total additions and dispositions in the rollforward to the amounts reflected in your statement of cash flows and (ii) the total realized and unrealized gains and losses to the statement of operations. Exhibits 39. We note that you have entered into employment agreements with Mr. Beard and Mr. Meade and that each of your named executive officers participates in the Gemini Space Station Senior Executive Severance Plan. Please file these agreements as exhibits to your registration statement pursuant to Item 601(b)(10) of Regulation S-K.
No reply letter found.
We note your disclosure on page 7 that the "following organizational transactions will be consummated in connection with this offering" is not followed by any disclosure. Please revise your disclosure to provide a summary of the transactions to be consummated in connection with the offering, or advise otherwise.
No reply letter found.
We note your risk factor disclosure regarding your historical reliance on related party loans to finance your business. Please expand this risk factor to discuss in greater detail, with quantification, as applicable, the extent to which you have historically relied upon related party financing and the extent of any such reliance going forward, if known.Rest of the question
Also, please describe in greater detail any potential consequences to your ability to finance your future operations or business plans if such related party transactions are interrupted or terminated. Finally, please consider including summary risk disclosure regarding your reliance on related party loans, to the extent material.
No reply letter found.
Please revise your disclosure under "Key Business Metrics" to address the following points: • Explain the importance of Monthly Transacting Users to the management of your business and how MTU correlates to growth in trading volume, net income, or other key operating results.Rest of the question
• Explain in greater detail how MTUs may overstate the number of unique consumers due to differences in "product architecture" or "user behavior," as you state on page 92, and provide quantified, illustrative examples thereof, as appropriate. • Clarify whether your use of the term "user behavior" on page 92 refers to users registering for and using "multiple accounts with different email addresses, phone numbers, or usernames," as referenced on page 80, or whether the term refers to any other user behaviors.
No reply letter found.
We note that the bar chart titled "End of Quarter Monthly Transacting Users" on page 93 does not have numbers on the vertical axis. Please revise this chart to clearly label the vertical axis to help investors better understand the data represented by the height of each respective bar and the significance of any height differentials among them (e.g., Q4 2023 vs. Q4 2024).
No reply letter found.
We have considered your response to our prior comment 13. It appears from your response that a portion of your share-based compensation costs were charged to additional paid in capital rather than salaries and compensation expense.Rest of the question
Please explain to us the nature of the adjustment to additional paid in capital and explain to us why it is necessary to add the full share-based compensation costs of $25 million to net income to arrive at adjusted EBITDA when it appears approximately $15 million of those costs were expensed.
No reply letter found.
Please tell us what consideration you've given to disaggregating transaction revenue and services revenue in your revenue table to provide year over year changes in revenue by source (e.g., exchange, OTC, credit card revenue, staking revenue, etc.). Additionally, we note in your discussion of the causes of year over year revenue fluctuations, you cite multiple factors that resulted in the change.Rest of the question
When a material change in a line item is attributed to two or more factors, including any offsetting factors, the contribution of each identified factor should be described in quantified terms, if reasonably practicable. Refer to Item 303(a) of Regulation S-K and Section III.D of SEC Release No. 33-6835.
No reply letter found.
In your response to our prior comment 36, you indicated that crypto assets held on the consolidated balance sheets are used primarily to support core operations, facilitate efficiency of the exchange, and as a reserve to satisfy regulatory requirements for certain subsidiaries.Rest of the question
Please expand your disclosure to describe in sufficient detail your reasons for holding crypto assets and their potential use as a means to support core operations. In your revised disclosure, please include a discussion of any restrictions placed on the use of crypto assets by virtue of their use as a reserve to satisfy regulatory requirements and quantify the amount of such reserve. Finally, please tell us whether you believe the use of crypto assets as a reserve to satisfy regulatory requirements constitutes a contractual sale restriction as described in ASC 350-60-507 and if so provide the necessary financial statement disclosure. Business, page 111
No reply letter found.
We note your response to prior comment 19 regarding your present Listing, Issuing, and Custody Policy and your policies and procedures regarding the commingling of assets. Where appropriate in the prospectus, please revise your disclosure to provide a material summary of such information.
No reply letter found.
We note your response to prior comment 21 regarding the steps to approve new crypto assets for support on your platform, including the commercial, legal, and technical considerations given when making such a determination. Please revise your disclosure to provide a material summary of such information.
No reply letter found.
We note your revised disclosure on page 123 and your response to prior comment 24 and reissue the comment in part. Please further revise your disclosure to include the information provided in your response regarding the persons within Gemini who oversee the reserve investment policy and disclose how your reserve investment policies may be modified.
No reply letter found.
Please confirm for us whether Gemini Space Station Inc. is expected to be capitalized on an other than nominal basis prior to effectiveness.
No reply letter found.
We note your response to our prior comment 28. Given the fungible nature of some of your crypto asset holdings, please tell us, and consider expanding your disclosure to further discuss, how you determine the amount and types of crypto assets that are purchased and disposed immediately and those that are purchased and held.Rest of the question
For example, please clarify whether certain business activities determine whether a purchased crypto asset will be disposed of nearly or immediately or held for a longer term.
No reply letter found.
Please disclose the amount of customer custodial funds related to your Gemini Dollar as of December 31, 2024 and 2023, and disclose how you account for and classify the related obligation.
No reply letter found.
We note the revised disclosure in response to prior comment 32. As previously requested, please revise to clarify whether you are able to sell, pledge or rehypothecate the assets.
No reply letter found.
Please tell us your consideration of further disaggregating exchange revenues for spot and derivatives transactions.
No reply letter found.
We note your response to our prior comment 34. Please further revise your revenue table to provide a disaggregated presentation of, and a subtotal for, revenue recognized from contracts with customers separate from other sources of revenue. In that regard we note your presentation combines interest income with other services revenue recognized from contracts with customers.
No reply letter found.
Please revise the disclosure of your accounting policy to more clearly state whether you believe you are the principal or agent with respect to trades executed on your platform. Based on your current disclosure, it is unclear whether you have concluded you never control the crypto assets before they are transferred to the customer or whether you make that determination on a case by case basis.Rest of the question
In your revised disclosure and response, please clarify whether all your transaction revenue has been recorded on a net basis, gross basis or a combination thereof. Finally, please also make corresponding clarifications to revenue recognized from OTC and NFT trades.
No reply letter found.
We note your response to our prior comment 36. Please clarify for us whether you have determined you are the principal or the agent in instant order transactions. In your response, please address the following: • To the extent you have concluded you are acting as an agent in instant order transactions, explain to us why the GILP holds crypto inventory.Rest of the question
• Given the fungible nature of the crypto assets exchanged, explain to us how you concluded instant order transactions are not settled from GILP inventory but rather from the Company's Central Limit Order Book. • Explain to us whether the GILP takes possession of crypto assets acquired from the Company's Central Limit Order Book before they are transferred to the user making the instant order. • In your response, you indicate that a trade will only be executed if it does not cause a loss for the Company. If you are acting as an agent providing a matching service between users on your platform, explain to us how a trade could result in a loss for the Company.
No reply letter found.
We note your response to our prior comment 30 and the related revisions to your disclosure. Please tell us how you determined you act as an agent of the issuing bank with respect to your credit card arrangement despite your agreement in 2024 to acquire all of the credit card loans.Rest of the question
In your response, please tell us the portion of your credit card revenue attributable to interest, fees and interchange income and what those amounts would have been if they were recorded gross as the principal. Staking revenue, page F-24
No reply letter found.
Please disclose where you record the associated payments to your customers related to the Ether staking.
No reply letter found.
Your tables of crypto asset loans as of December 31, 2024 and 2023 present the total number of crypto assets borrowed for each loan at loan origination. Additionally, in the footnotes below the tables you disclose amounts of crypto assets that have been repaid subsequent to loan origination.Rest of the question
Tell us what consideration you've given to also disclosing the total number of loaned crypto assets that remain outstanding at each period end.
No reply letter found.
Please briefly summarize your accounting treatment for the transactions. We do not see a discussion of the transaction(s) whereby the Founders receive Class B common stock. Further, on page 78 you disclose that Gemini Space Station, LLC's convertible notes and convertible term loans will convert into LLC Interests immediately prior to or upon consummation of the offering.Rest of the question
Tell us whether those LLC Interests will subsequently be converted into Class B (or A) common stock of the registrant and when. As applicable, revise your disclosure to clarify.
No reply letter found.
Refer to prior comment 7. Please disclose, similar to your response, that the applicable regulatory frameworks require you to maintain a minimum level of crypto assets to meet ongoing licensing or regulatory obligations and the regulatory agreement prohibits lending, pledging, rehypothecation, or encumbrance of the assets, but it does not prohibit the sale of such assets.
No reply letter found.
We note your response to prior comment 14. Please tell us how you considered the fact that you may not sell, pledge, or rehypothecate the crypto assets in your conclusion that you control those assets. In your response, please describe the purpose behind any regulatory capital requirements and clarify for us how loaned crypto assets can support regulatory requirements if they cannot be sold, pledged or exchanged.Rest of the question
Note 3. Revenue Transaction revenue, page F-23 We have considered your response to our prior comment 18. Please address the following with respect to instant orders executed through the GILP: • Provide us with copies of any contracts or terms and conditions related to instant orders. • Provide us with a step by step walkthrough of the instant order process from the perspective of both the buyer and seller of crypto assets. In your response, please clarify for us whether crypto assets used to settle instant orders are sourced from crypto assets held in custody by you in omnibus wallets, held in custody by sellers in their own wallets or a combination of the two. In addition, to the extent you are able, please tell us the gross transaction amount of instant orders for each period presented in your financial statements. • In your prior response you state "At no point does the Company control the crypto assets in the trade settlement execution, nor are customer assets commingled with corporate assets." Please expand on how you determined you do not have control of the crypto assets at any point in the trade settlement execution. In your response, please explain to us which entity has control of the crypto assets during this process. In addition, please clarify for us whether you obtain legal title to the crypto assets at any point during trade settlement execution and if not explain to us what entity does have legal title at each stage of settlement execution. Please provide us with a more detailed discussion of how you considered the indicators in ASC Topic 606-10-55-39 in determining you are the agent with respect to instant orders. In your analysis, please address, but do not limit your response to, the following: Clarify for us how you considered whether you have inventory risk given the statement in your response that GILP takes possession of the crypto assets as o • 4. part of settling the trade. o In your response you state that you reserve the right to reject any order for any reason. Please expand on this statement and provide us with examples of when you would reject an order. o Provide us with a more detailed discussion of how you determined you do not have discretion in setting price. In that regard, we note you provide a firm quote to users when an order is initiated, and you have designed the fill-orkill parameters. Tell us how you considered these facts in your analysis. In addition, please tell us who establishes the fees charged on instant orders and how that fact was considered in your price discretion analysis.
No reply letter found.
We note your added disclosure regarding the non-employee directors. Please revise your disclosure to clarify each person's term of office as director and the periods during which they served as such. In addition, please briefly discuss the specific experience, qualifications, attributes or skills that led to the conclusion that each person should serve as a director. See Item 401(a) and (e) of Regulation S-K.Rest of the question
Underwriting
Company respectfully acknowledges the Staff’s comment and has revised its disclosure on pages 153-155 of the Registration
Statement to clarify each person’s term of office as director and the periods during which they served as such. Further, the
Company has revised its disclosure to discuss the specific experience, qualifications, attributes or skills that led to the conclusion that each person should serve as a director. Read in the reply ↗
We note the directed share program referenced on page 171. Please revise to address the following points in your next amendment: • You state that shares under the directed share program will be offered to "certain individuals and entities." Please identify with more specificity the category of persons eligible to participate in the program.Rest of the question
• Expand your disclosure to address the process that prospective participants will follow to participate in the program, the manner in which you will communicate with prospective participants about the program, when and how you will determine the allocation for the program, whether such allocation will change depending on the interest level of potential participants, and any other material features of the program.
Company respectfully acknowledges the Staff’s comment and has revised its disclosure on pages 192-193 of the
Registration Statement in response to the Staff’s comment. In particular, the Company has revised its disclosure to identify with more specificity the category of persons eligible to participate in the directed share program, address the process that prospective participants will follow to participate in the program, the manner in which the Company will communicate with prospective participants about the program, when and how the Company will determine the allocation for the program,Read in the reply ↗Rest of the answer
and whether such allocation will change depending on the interest level of potential participants. The Company has also revised its disclosure to include other material features of the directed share program.
We have considered your response to our prior comment 3. Please tell us whether the proceeds from your related party crypto loans are subject to contractual sale restrictions, and if so, tell us how you considered the guidance in ASC Topic 350-6050-6.
The Company respectfully acknowledges the Staff’s comment and advises the Staff that while the proceeds from its related party crypto loans are subject to contractual sale restrictions under the related party loan agreements, these provisions are intended to preserve capital reserves for regulatory and fiduciary purposes at the subsidiary level, rather than limit liquidity in all circumstances.Read in the reply ↗Rest of the answer
In the event of significant market or liquidity stress, the applicable subsidiary may sell such assets to meet its regulatory obligations, consistent with the purpose of maintaining the capital reserve. Additionally, as discussed in prior comment 3, while the crypto assets were initially obtained through a borrowing facility at the parent company, they were subsequently contributed to the regulated subsidiary under a formal capital contribution agreement. At the subsidiary level, the assets are not restricted by the terms of the agreement.
Further, the Company respectfully advises the Staff that the Company believes that the disclosures required by ASC 350-60-50-6 are addressed in the Company’s financial statement footnotes to the consolidated financial statements included in the Registration Statement, including within Note 7. Crypto Assets Held and Note 13. Related Party Loans and Convertible Notes, which provide disclosure on the fair value of crypto assets held, the nature of certain restrictions on some of these assets arising from their designation as regulatory capital reserves, and the terms of the restrictions being subject to regulatory requirements and the related party loans. In response to the Staff’s comment, the Company has revised its disclosure on pages F-39 and F-80 of the Registration Statement to improve the clarity and prominence of its disclosures required by ASC 350-60-50-6.
We note your disclosure in the footnotes to the exhibit index that certain portions of Exhibits 10.2 and 10.3 have been redacted in accordance with Item 601(b)(10)(iv) of Regulation S-K. Please revise each exhibit to include on the first page the legend required by Item 601(b)(10)(iv).
comment and has revised Exhibits 10.2 and 10.3 of the Registration Statement to include on the first page the legend required by
Item 601(b)(10(iv). Read in the reply ↗
We note that you have added a gatefold, which discloses that you have 1.5 million lifetime transacting users. Where appropriate in the prospectus, please briefly discuss how you measure lifetime transacting users.Rest of the question
Risk Factors Our amended and restated articles of incorporation will provide that the Eighth Judicial District Court of Clark County, Nevada..., page 80 You disclose that your amended and restated articles of incorporation will provide that, unless you consent in writing to the selection of an alternative forum, the federal district courts of the United States of America sitting in Clark County, Nevada will be 2. the exclusive forum for the resolution of any cause of action arising under the federal securities laws of the United States, including any claims under the Securities Act and the Exchange Act. Please direct us to the portion of your amended and restated articles of incorporation that contains this provision. Use of Proceeds, page 89 3. We note your disclosure that you may "use the net proceeds to repay all or a portion of [y]our third-party indebtedness, including indebtedness outstanding under the Galaxy Lending Agreement and the Master Repurchase Agreement with NYDIG Funding LLC." To the extent a material part of the proceeds will be used to discharge indebtedness, please disclose the interest rate and maturity of such indebtedness. If the indebtedness to be discharged was incurred within one year, describe the use of the proceeds of such indebtedness other than short-term borrowings used for working capital. Refer to Instruction 4 to Item 504 of Regulation S-K. Capitalization, page 91 4. Please reconcile for us the amounts shown for indebtedness to your condensed consolidated balance sheet as of June 30, 2025 on page F-65, and how you determined the total amount of capitalization given the amounts shown for liabilities in the table. In this regard, it appears your table excludes the current portion of related party loans in the amount of $618,461. Please advise or revise. Dilution, page 92 5. Please present the impact of the offering and the Vested IPO Grants separately, or tell us why these two events should be combined. Management's Discussion and Analysis of Financial Condition and Results of Operations Critical Accounting Policies and Estimates Stock-Based Compensation, page 120 6. Once you have an estimated offering price or range, please tell us the reasons for any differences between recent valuations of your common stock leading up to the IPO and the estimated offering price. Business Other Ongoing Litigation, page 146 7. Please disclose the name of the court or agency in which the matter entitled National Association of Consumer Advocates v. Gemini Trust Company, LLC is pending and the date instituted. See Item 103 of Regulation S-K. Description of Capital Stock Provisions of our Amended and Restated Articles of Incorporation and Amended and Restated Bylaws, page 179 We note that Article XIII of the form of Amended and Restated Articles of Incorporation states that "[t]o the fullest extent not inconsistent with any applicable U.S. federal laws, any and all 'internal actions' (as defined in NRS 78.046) must be tried in a court of competent jurisdiction before the presiding judge as the trier of fact 8. and not before a jury." Please include a description of this provision in your prospectus and clearly state, if true, that the provision does not apply to claims under the Securities Act and the Exchange Act. Also disclose the risks of the provision and other impacts on shareholders as well as any uncertainty about enforceability. Unaudited Condensed Consolidated Financial Statements as of and for the six months ended June 30, 2025 and 2024 Note 13. Related Party Loans and Convertible Notes Term loan, page F-89 9. Please expand your disclosure to state, if true, that your term loans are accounted for at fair value. In your revised disclosure, clarify the features of the loan that result in fair value accounting and the authoritative literature that supports your accounting conclusions. Exhibits Exhibit 5.1, page II-4 10. Please file a revised legal opinion that separately opines on the shares of Class A common stock subject to the over-allotment option that may be sold by the selling stockholders. In this regard, please note that the opinion should state that the shares are validly issued, fully paid and non-assessable. For guidance, refer to Section II.B.2.h of Staff Legal Bulletin No. 19. 11. In romanette (v) in the fourth paragraph of the opinion, we note that counsel has assumed that "upon each issuance of Shares, the total number of shares of Class A Common Stock issued and outstanding, together with the total number of shares of Class A Common Stock reserved for issuance or obligated to be issued by the Company pursuant to any plan, agreement or arrangement, or otherwise, will not exceed the total number of shares of Class A Common Stock then authorized under the Company's articles of incorporation." Please obtain and file a revised opinion that does not include this assumption, or tell us why this assumption is necessary and appropriate.
Skadden, Arps, Slate, Meagher &
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PROVISIONS OF THIS LETTER HAVE BEEN OMITTED FROM THE VERSION FILED VIA EDGAR. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.Read in the reply ↗Rest of the answer
INFORMATION THAT WAS OMITTED IN THE EDGAR VERSION HAS BEEN NOTED IN THIS LETTER WITH A PLACEHOLDER IDENTIFIED
BY THE MARKER “[***]”.
ABU DHABI
BEIJING
BRUSSELS
FRANKFURT
August 29, 2025
HONG KONG
LONDON
MUNICH
PARIS
SÃO PAULO
SEOUL
SINGAPORE
TOKYO
TORONTO
VIA EDGAR
Securities and Exchange Commission
Division of Corporation Finance
Office of Crypto Assets
100 F Street, N.E.
Washington, DC 20549-3561
Attn:
David Lin
Irene Paik
Kate Tillan
Robert Telewicz
Re: Gemini Space Station, Inc.
Registration Statement on Form S-1
CIK No. 0002055592; No. 333-289665
On behalf of our client,
Gemini Space Station, Inc., a Nevada corporation (the “Company”), we are submitting this letter in connection with the Comment #6 received from the staff (the “Staff”) of the Securities and Exchange Commission (the “Commission”) by letter dated August 28, 2025 (the “Comment Letter”) with respect to the above-referenced Registration Statement on Form S-1 filed with the Commission on August 15, 2025, as amended on August 21, 2025 (as so amended, the “Registration
Statement”).
Because of the commercially sensitive nature of the information contained herein, this submission is accompanied by our request, on behalf of the Company, for confidential treatment of selected portions of this letter pursuant to Rule 83 of the Commission’s Rules on Information and Requests,
17 C.F.R. § 200.83 and the Freedom of Information Act.
Overview
Historically, the Company has issued to certain employees non-voting incentive units that act as profits interests and phantom profits interests. The incentive units only participate above an established threshold and vest over a stated period of time. Profit interest units permit holders to participate in increases in value of the Company. Phantom profit units perform a similar function for non-US employees.
The Company’s discussion of its incentive unit-based compensation in the Registration Statement is primarily contained in Note 17. Stock-based Compensation to the Company’s audited consolidated financial statements as of and for the year ended December 31, 2024.
There is no public market for the Company’s equity units because the Company is private. As such, the Company determined the fair value of its incentive units with the assistance of valuations conducted by independent third-party valuation specialists, a nationally recognized “Big-4” audit and assurance firm. However, the Company assumed responsibility for the estimates of fair value of its incentive units in the financial statements. The Company utilized methodologies, approaches and assumptions consistent with the American Institute of Certified Public
Accountants (“AICPA”) Accounting and Valuation Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation. The Company believes that the determination of the estimated fair values of the Company’ equity was fair and reasonable at the time they were made. The fair value of the Company’s equity on a marketable, controlling interest basis was as follows:
Valuation Date
Capitalized value
Date of Valuation Report
3/31/24
[***]
9/12/24
9/30/24
2/4/25
3/31/25
5/12/25
All awards granted between
2024 and 2025 were assigned valuations performed by independent third-party valuation specialists, including the following:
● the rights and preferences of the incentive units relative to those of the Company’s voting common units, including vesting terms, rights to distributions and voting rights,
● the Company’s business strategy, external market conditions affecting the cryptocurrency industry, and trends within the cryptocurrency industry,
● the Company’s financial position, including cash on hand, indebtedness, and its historical and forecasted performance and operating results,
● the Company’s stage of development in its acquisition strategy
● the likelihood of achieving a liquidity event, such as an initial public offering, in light of prevailing market conditions, and
● the analysis of initial public offerings and the market performance of similar companies in the cryptocurrency industry.
Historical Fair Value Determination Methodology
The Company’s management determined the Company’s equity value by utilizing a third-party independent valuation expert’s input and generally considering the income and market approach valuation. The income approach estimates value based on the expectation of future cash flows that a company will generate. These future cash flows are discounted to their present values using an appropriate discount rate based on a weighted-average cost of capital and are adjusted to reflect the risks inherent in the Company achieving these estimated cash flows. The market approach estimates value based on a comparison of the subject company to comparable public companies in a similar line of business. From the comparable companies, a representative market value multiple is determined and then applied to the subject company’s financial forecasts to estimate the value of the subject company.
The valuations of the Company’s equity from March 31, 2024 to March 31, 2025 fluctuated primarily due to fluctuations in revenue and the Company approaching its estimated initial public offering date of September 30, 2025. The Company experienced a decrease in revenue beginning in April 2024 through October 2024, which resulted in a decreased valuation for the September 30, 2025 valuation. While the Company’s revenue increased temporarily in November 2024 and December 2024 following the U.S. presidential election, this period was evaluated as too short and was not determinative enough to be deemed representative of a sustainable trend. As a result, the Company determined it did not provide sufficient basis to revise the overall revenue forecast upward and thus increase the Company’s equity valuation.
By March 2025, the Trump administration had taken office and brought continued focus to the cryptocurrency industry, which allowed revenue to continue trending positively through 2025 such that it was reasonable to increase revenue forecasts and therefore the Company’s valuation on March 31, 2025.
Incentive Unit Grants
Between January 1, 2024 and the date hereof, the Company has issued the following incentive units:
Date of Grant
Units Granted
Equity
Valuation
Date
Utilized
Date of
Report
Weighted equity value
PIU Threshold
Granted ($)
Grant threshold >= equity value
15-May-2024
6/30/23
9/19/23
YES
11-Jun-2024
02-Aug-2024
30-Sep-2024
26-Dec-2024
27-Dec-2024
24-Jan-2025
30-Jan-2025 n/a
Note:
In the Company’s correspondence with the valuation specialist, the Company’s valuation specialist noted that the January 2025
PIUs were granted at participation threshold valuations of $[***], which was above the fair values indicated in September 2024
($[***]) and March 2025 ($[***]). The participation threshold is generally set at or above the fair value on the grant date to ensure that value only accrues to participants upon the creation of incremental shareholder value. The associated capitalized value for those grants was therefore in excess of $[***]. They also noted that the lower bounds for their valuation for tax purposes would have been even lower on a fair value basis based on the Series B and related party debt conversions, which can have a dilution impact of [***]% based on a pre-money valuation range of $[***] (Exhibit 1).
For incentive units granted between valuation dates, the Company considered the amount of time between the valuation date and the grant date, the number of shares issued, and similarity of performance metrics including revenue, and any issuance of additional debt to determine whether to use the estimated fair value as of the last valuation for financial reporting purposes or to make modification to such estimated fair value based on the factors described above. The Company performed valuations twice per year to ensure the valuations assigned to specific classes of profit units were accurate and considered the frequently evolving cryptocurrency industry.
Comparison of the Fair Value per Common
Share Used for Share-Based Compensation Expense and the Estimated Offering Price
The
Company supplementally advises the Staff that on August 28, 2025, representatives of the underwriters (the “Representatives”), on behalf of the several underwriters for the IPO, advised the Company that, based on then-current market conditions, they anticipated that the underwriters would recommend to the Company a preliminary price range of $[***] to $[***] per share (the “Preliminary
Price Range”), resulting in a midpoint of the Preliminary Price Range of $[***] per share (the “Midpoint Price”).
The Midpoint Price equates to an approximately $[***] billion capitalized valuation (the “Midpoint Valuation”). As is typical for initial public offerings, the Preliminary Price Range was not derived using a formal determination of fair value but was determined as a result of discussions among the Board, the Company’s management team and the Representatives, and took into account the general conditions of the securities market and the recent market prices of, and the demand for, publicly traded common stock of comparable companies, the Company’s financial condition and prospects, estimates of business potential and earnings prospects for the Company and the industry in which it operates and valuation metrics for and recent performance of initial public offerings of publicly traded companies similar in industry and/or business model as the Company.
Company advises the Staff that the difference between the most recent grant date (the “January Grant Date”) capitalized valuation of $[***] billion and the $[***] billion Midpoint Valuation is attributable to a number of factors, including:
● The Preliminary Price Range does not take into account the current lack of liquidity for the Company’s common stock and assumes a successful IPO with no weighting attributed to any other exit scenario such as those contemplated under the going concern scenario.
● The Preliminary Price Range does not take into account the liquidation preference of the Company’s convertible preferred stock and convertible notes, which represent a significant component of the Company’s capitalization as of the most January Grant Date. This liquidation preference results in a lower proportion of the Company’s overall value being attributable to common stockholders as of the January Grant Date under the going concern scenario as compared to in the event of a successful IPO.
● Since the January Grant Date, the Company has taken several steps towards the successful completion of an IPO, which includes the Company receiving additional feedback from potential qualified investors during “testing-the-waters” meetings.
● In October 2023, the NY Attorney General filed a lawsuit against Genesis Global Company (“GGC” or “Genesis”), its parent company Digital Currency Group (“DCG”), and Gemini Trust Company (“Gemini”) for defrauding investors participating in the Company’s “Earn Program”. Following this lawsuit, Gemini experienced a year of revenue decline in 2024 and reputational injury which led to lower transaction volumes and customers. During this time, Gemini incurred high operating costs including legal costs and its previous growth strategy shifted to manage the impact from the lawsuit allegations.
To cover operational costs, the Company entered into debt agreements throughout 2023 and 2024.
● Beginning in 2025, the Company has re-engaged its growth strategy through its increased participation in marketing and its growing service offerings including trading tokenized stocks in the EU and institutional Solana staking. Additionally, the Trump administration is pushing advancements and removing regulation that had historically provided limitations on the expansion of the cryptocurrency industry. In August 2025 an executive order was signed to allow cryptocurrency into 401K accounts and in July 2025 the House of Representatives passed the Guiding and Establishing National Innovation for U.S. Stablecoins Act, a law that establishes a federal framework for regulating payment stablecoins. The general sentiment of cryptocurrency has significantly increased in 2025 as reflected by the material recent growth of peer public company’s valuations.
● The market prices of publicly traded common stock of comparable companies, as well as the performance of recent IPOs in the technology industry, suggest a more favorable market for the Company to execute an IPO than market conditions on the January Grant Date (following the announcement of proposed tariffs by the United States in early April 2025 and subsequent cooling of capital markets activity).The Preliminary Price Range does not apply a discount to present value for the IPO and does not include a DLOM, as an active trading market for the Company’s common stock is expected to exist following the IPO.
The Midpoint Valuation further reflects the market sentiment and the strategic growth opportunities expected to continue to enhance the Company’s future performance and market position, as illustrated below by our peer group’s performance:
Company
March 31, 2025
Price
IPO
August 28, 2025
Change
Coinbase [NASD: COIN]
193.95
308.47
+59%
Robinhood [NASD: HOOD]
41.62
103.69
+149%
Circle [NYSE: CRCL]
31.00
130.94
+322%
Bullish [NYSE: BLSH]
37.00
64.43
+74%
We thank you in advance for your consideration of the foregoing.
* * * * *
Given the changes in your capitalization as a result of the Transactions and the Additional Borrowings, please include explanatory notes to explain the adjustments reflected in the pro forma amounts. For example, define the term "Additional Borrowings," including a description of the significant terms of the borrowings, and explain the changes to your cash and cash equivalents.Rest of the question
In your response, please clarify how the pro forma adjustments made to your capitalization table relate to the pro forma adjustments described on page 15 in your summary historical consolidated financial data. Additionally, please explain how your adjustment to reflect the conversion of approximately $788 million of convertible notes and convertible term loans reconciles to your disclosure on page 12 which discusses the conversion of approximately $695.6 million of convertible notes and convertible term loans.
No reply letter found.
We note your disclosure of exchange revenue by crypto asset for the one month period ended July 2025 and 2024. Tell us what consideration you gave to balancing this disclosure by also providing exchange operating expenses or profit for the same one month periods.
No reply letter found.
We note your revised disclosure in response to prior comment 8 that the limited jury waiver provision in your amended and restated articles of incorporation is intended to apply to any and all "internal actions" (as defined in NRS 78.046) to the fullest extent not inconsistent with any applicable U.S. federal laws (including the Securities Act and the Exchange Act).Rest of the question
Please further revise your disclosure here and on pages 80 – 81 to clearly state whether such provision applies to claims under the Securities Act or the Exchange Act. If not, please also ensure that the limited jury waiver provision in your amended and restated articles of incorporation states this clearly, or tell us how you will inform investors in future filings that the provision does not apply to any actions arising under the Securities Act or Exchange Act.
No reply letter found.
We note that Nasdaq has agreed to purchase $50 million of your Class A common stock in a private placement in connection with the offering. Please consider including risk factor disclosure regarding any conflicts of interest, regulatory risks and governance risks to the extent material.Rest of the question
In this regard, please tell us, with a view toward disclosure, whether Nasdaq has participated in a private placement concurrent with the IPO of a company listing on the exchange before, and whether the novelty of this relationship creates additional uncertainty and risk. We note that on September 8, 2025, you entered into a definitive term sheet relating to your prospective collaboration agreement with Nasdaq. To the extent this term sheet 2. contains binding provisions that are material to you, please describe in greater detail the material terms of the term sheet and include quantified disclosure thereof, as applicable. Please also disclose any material risks related to this arrangement (e.g., conflicts of interest, etc.). Ripple Cobranded Card, page 6 3. To the extent material to your business, please disclose the material terms of any agreement, arrangement, or understanding you have with Ripple in connection with the Ripple co-branded credit card, which you disclose that you launched on August 25, 2025. Also, please file any documents memorializing the same as exhibits, if required by Item 601 of Regulation S-K. Please also balance your disclosure in this section. In that regard, we note your disclosure on page 103 that Card Sign-Ups should be evaluated together with Cards Issued, transaction volume, and related receivables to provide a comprehensive view of card program performance.
We note your revised disclosure in response to prior comment 2. Please revise your disclosure here and on pages 186 - 187 to address the following:
· Please consider streamlining your disclosure in the first two paragraphs of this risk factor, as much of the information appears redundant. In this regard, both paragraphs appear to summarize Section 11.1 of the form of Amended and Restated Articles of Incorporation, although the second paragraph appears to be more consistent with the contents of Section 11.1.
Please revise as appropriate.
· Section 11.1 of the form of Amended and RestatedRead in the reply ↗Rest of the answer
Articles of Incorporation states that the
“exclusive forum provisions will not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction” (emphasis added), consistent with your disclosure in the second paragraph of this risk factor. However, in the first paragraph of this risk factor, you disclose that the “exclusive forum provisions will not apply to suits brought to enforce any liability or duty created by the Securities Act or the Securities Exchange Act of 1934
..., or to any claim for which the U.S. federal courts have exclusive jurisdiction” (emphasis added). Please revise your disclosure to reconcile this inconsistency.
· Please expand your disclosure to describe Section 11.2 of the form of Amended and Restated
Articles of Incorporation.
· We note that Section 11.2 of the form of Amended and Restated Articles of Incorporation states that “[u]nless the Corporation consents in writing to the selection of an alternative forum, the federal district courts of the
United States shall be the sole and exclusive forum for the resolution of any claim asserting a cause of action arising under the Securities
Act of 1933, as amended, against any person in connection with any offering of the Corporation’s securities, including, for the avoidance of doubt, any auditor, underwriter, expert, control person, or other defendant, which person shall have the right to enforce this clause.” Please revise your disclosure to address any uncertainty around the enforceability of this provision, given the concurrent jurisdiction provided in Section 22 of the Securities Act. Relatedly, we note your statement in the penultimate sentence of the second paragraph of this risk factor that, “[h]owever, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce a duty or liability created by the Securities Act or the rules and regulations thereunder and, accordingly, we cannot be certain that a court would enforce such provision.” It appears that you may have intended to refer to the forum selection provision specified in Section 11.2, rather than in Section 11.1, with respect to this sentence.
Please revise or advise.
The
Company respectfully acknowledges the Staff’s comment and has revised its disclosure on pages 82-83 and 188-189 of the
Amended Registration Statement in response to the Staff’s comment. In particular, the Company has streamlined its disclosure on pages 82 and 188 of the Amended Registration Statement to improve clarity and remove redundancies. Similarly, the Company has revised its disclosure on pages 82 and 188 of the Amended Registration Statement to reconcile the inconsistency identified by the Staff in the Registration Statement and make clear that the exclusive forum provision will not apply to suits brought to enforce any liability or duty created by the Securities Exchange Act of 1934 (the
“Exchange Act”) or any other claim for which the federal courts have exclusive jurisdiction, consistent with
Section 11.1 of the Company’s form of amended and restated articles of incorporation. Further, the Company has expanded its disclosure on pages 82 and 188 of the Amended Registration Statement to describe Section 11.2 of its form of amended and restated articles of incorporation. Relatedly, the Company has clarified in its disclosure that the concurrent jurisdiction provided in Section 22 of the Securities Act of 1933 (the “Securities Act”) results in uncertainty around the enforceability of the provision specified in Section 11.2 of the Company’s amended and restated articles of incorporation, summarized on pages 82 and 188 of the Amended Registration Statement.
Capitalization,
Also in this review: company letter, 2025-09-02, company letter, 2025-09-10, company letter, 2025-09-10, company letter, 2025-09-10