Gemini's Charter Raises Costs and Limits Flexibility
Gemini
Gemini’s trust company structure is turning from moat into fixed overhead. The New York charter gives Gemini qualified custodian status and credibility with banks and funds, but it also locks the company into bank style compliance even as institutional trading is priced at just 2 to 3 bps and international expansion increasingly requires separate local entities, like the Singapore transition, instead of one flexible global product stack.
-
The unit economics are thin. Gemini generated $68.6M in H1 2025 while institutional volume reached $21.5B, or 87% of total volume, and institutional pricing sat around 0.02% to 0.03%. That means the compliance burden of a New York trust charter is being spread over a business where the core flow product is intentionally low margin.
-
The regulatory edge is getting copied. Kraken obtained a Wyoming bank charter in 2020 and announced a Federal Reserve master account in March 2026, while Anchorage received an OCC national trust charter in 2021. Once multiple venues can pitch regulated custody and banking style safeguards, Gemini no longer gets paid simply for being the compliant option.
-
International products become harder to localize fast. Gemini has said it is building in Singapore, Brazil, and the UAE, but the operating model is already fragmenting, with Singapore spot accounts moved in April 2025 from Gemini Trust Company to a local Singapore entity. By contrast, Kraken is building exchange liquidity as a base layer for region specific payments, banking, and stablecoin workflows on top.
The likely end state is that regulated crypto platforms separate into two groups. The winners will either have enough scale to absorb banking grade compliance, or enough product flexibility to tailor local rails by market. Gemini now has to prove it can do both at once, turning trust status into higher margin custody, derivatives, and stablecoin workflows before the cost base hardens permanently.