Tyler and Cameron Winklevoss think they have the answer to Bitcoin's rocky 2014 and tumbling value: a "fully regulated" Bitcoin exchange based in the United States. If Bitcoin is to break through as the frictionless payment method many believe it can be, it must evolve into "an ecosystem that is free of hacking, fraud and security breaches," wrote Cameron Winklevoss in a blog post announcing the Gemini exchange.
Obviously the cryptocurrency isn't there yet, and the brothers — who waged a high-profile legal tussle with Facebook's Mark Zuckerberg — claim the risks associated with Bitcoin right now are crippling its potential. "A growing number of US investors, traders, financial institutions and businesses wanted to get involved with bitcoin directly, but had no options other than to trade overseas or sit on the sidelines."
Gemini says it'll have top-notch security and FDIC insurance
So what's the answer? Gemini claims to have assembled "the nation’s top security experts, technologists, and financial engineers to build a world-class exchange from the ground up with a security-first mentality." So far, that's a team of 14 people (including Tyler and Cameron), with 11 of those spots filled by engineers. Gemini has also picked up the backing of a New York-based bank, though the twins aren't getting more specific than that. "This means that your money will never leave the country," said Winklevoss. And US currency on Gemini will qualify for FDIC insurance, a measure that should have investors confident that funds will be "as safe and secure as they are in your bank account today."
Apparently seeing the total collapse of Mt. Gox and troubles experienced by other exchanges hasn't discouraged the Winklevoss brothers. "The A Team wasn’t there,” Tyler Winklevoss told The New York Times. "There was a problem here and it needs to be solved.” Gemini will be ready to try its hand at fixing that problem as soon as the exchange gains regulatory approval from Benjamin M. Lawsky, the superintendent of New York's Department of Financial Services; a test model of the exchange is already up and running, according to the Times. There's good reason for the Winklevoss brothers to pick up Bitcoin's reputation; they reportedly invested nearly $11 million in the currency back in 2012. For a while, that seemed like a good bet, but now the Winklevoss twins clearly see a need to bring some sense of order in the world of Bitcoin.