Gemini, the Winklevoss twin operated cryptocurrency exchange is reportedly planning to allow professional traders and investors to purchase huge amounts of digital currency and have planned to release Gemini block trading service on April 12th. Gemini which began in 2015 was the first licensed Ethereum exchange, they use a system of complex private keys for protecting Bitcoin and store most of them offline to minimize the risk of hacking.
Gemini who in a statement through Bloomberg has said that they are willing to allow traders to buy or sell large quantities of Bitcoin and other virtual currencies, like circle trade who is reported to have been moving more $2Billion in assets. They have planned to compete with companies that cater to large institutional buyers.
Their system of operation includes where a customer who places a block order can specify whether they want to:
- Buy or sell
- Minimum interest required fill quantity
- Price limit
They have specified that market makers can only receive information about receiving quantity, minimum quantity and the collar price and nothing which is related to the block order.
Gemini works on the principle of Block trade where the data transaction volume is controlled, that is, the volume generated by data transactions reaches a level where the market is getting influenced by having a disproportional effect on the marketplace. To prevent this from happening, transactions are conducted privately at a fixed price. These transactions are published with a 10 minutes delay which ensures that all participants have access to pricing and liquidity information and prevents the proneness of the data’s effect on prices.
Cameron Winklevoss, in a blog post, wrote that the block orders will be electronically broadcasted fulfilling their commitment to an equitable, transparent and rules-based marketplace.
Users were critical of the new exchange, Josh Adkins a tweeter tweeted
“You think we could at least have stop losses since we are now paying 1%”