Gemini’s Operations Approved By Deloitte
The cryptocurrency exchange owned by famous investors Tyler and Cameron Winklevoss, Gemini, recently became more valuable for institutional players. The exchange has reported that it completed the SOC 1 Type 1 examination, before any other exchange on the market.
The examination was conducted by Deloitte, one of the ‘Big Four’ consulting firms in the world. This reputable organization assessed whether the description of Gemini Custody was accurate, whether control design is sustainable and whether the controls were in place. Passing these criteria means that Gemini Platform is verified to have low risks of ‘errors, omission or data loss’. In short, this means that large players can be more confident about trusting their funds to Gemini.
As Tyler Winklevoss recently stated, the exchange is going to maintain the high quality of risk management. The next step Gemini is going to do in this direction is to complete SOC 1 Type 2 examination, which is similar to SOC 1 Type 1, except that it assesses a company’s performance over a period of time.
Why Is It Important?
Since the crypto bubble of 2017 the narrative of large financial institutions getting interested in crypto has started to emerge. Besides large traditional exchanges like CME and CBOE tapping into the crypto space there are also players like Bakkt, which early focus was strictly on institutions.
One of the key factors for institutions to be able to operate on the crypto market is proper infrastructure. Custody is an important part of this infrastructure and, according to KPMG, crypto custodians have a significant potentialfor growth.
By getting regulatory approvals Gemini tells its potential institutional customers that they can trust the platform with millions of investors’ money without worrying about funds being hacked away. This places the exchanges on the line with big crypto players like Coinbase and even larger traditional players like Fidelity Investments.