By Paul R. La Monica

It might not be another crypto winter just yet. But the current correction for Bitcoin from last month's all-time highs and the slides for Ethereum, XRP, Solana, and other top cryptocurrencies are starting to take their toll on stocks that have ties to the digital currency universe. Just look at Gemini Space Station, the crypto investment firm led by Cameron and Tyler Winklevoss that recently went public.

Gemini fell 54% in midday trading Monday. When it debuted on Sept. 12, the stock surged 45% in the first few minutes of trading and finished with a gain of almost 15% from its initial public offering price. It's been all downhill since then. Gemini is now trading at about $23, nearly 20% below its $28 IPO price.

Investors may be worried about the volatility in crypto prices, as well as tough competition in crypto trading. Gemini's fundamentals are a bit shaky, too. Although revenue soared 45% in 2024, the company lost money. In the first half of this year, it posted a decline in revenue of 8% and has widened its losses as well.

Gemini is not the only crypto stock to take a hit Monday. Shares of rivals Coinbase, Robinhood, and Galaxy Digital were all lower along with the drop in Bitcoin prices. Bullish, another crypto stock that recently went public and reported strong earnings last week, was down 5% Monday.

Even though the price of Bitcoin is still up sharply this year and there is enthusiasm about digital assets over the longer term -- thanks to a more favorable regulatory and legislative environment in Washington -- investors still have to come to grips with the fact that crypto brokerage stocks are priced to perfection.

Coinbase, for example, is trading at almost 45 times earnings estimates for this year while Robinhood has a price-to-earnings ratio of 75. Galaxy is expected to lose money this year and in 2026.

So don't be surprised to see crypto brokerage stocks whipsawed even further as Bitcoin prices fluctuate wildly. Cryptocurrencies aren't for the faint of heart, and neither are the shares of the companies that are closely tied to digital assets.

Write to Paul R. La Monica at paul.lamonica@barrons.com

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September 22, 2025 12:39 ET (16:39 GMT)

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