Citi analyst Peter Christiansen downgraded Gemini Space Station (GEMI) from Neutral to Sell and slashed the price target from $13 to $5.50 in a research note on Wednesday, March 18, 2026. The downgrade preceded the company's fiscal-year earnings report due Thursday after market close.
The stock reacted immediately, falling 5.1% in premarket trading to approximately $6.75 per share. This decline extends a brutal year-to-date performance, with GEMI down 28% since the start of 2026. The stock has collapsed from its September 2025 IPO price of $28 and its first-day pop to around $37, now trading below $6.
Citi's revised financial projections paint a grim picture. The firm now expects Gemini to post an adjusted EBITDA loss of $263 million for 2025. Furthermore, Citi has pushed back its forecast for the company to reach positive EBITDA from 2028 to 2029 at the earliest, citing "increasing concerns the company will be challenged to scale profitability within a reasonable time frame for equity investors."
The analyst also noted that legislative progress on the CLARITY Act, which could help shape crypto platform regulation, remains stalled, adding to the uncertainty.
User metrics show a significant downturn. Monthly app downloads plummeted to just 41,000 in February 2026, down from over 100,000 per month for the prior nine consecutive months. This decline in user growth and network effect comes as the broader crypto market has cooled from its 2025 peak, with Bitcoin down roughly 40% from its levels when Gemini debuted, reducing industry-wide trading volumes and revenue.
In response, Gemini has undertaken aggressive cost-cutting measures, including laying off 25% of its workforce and winding down operations in the UK, Europe, and Australia. Key executives, including the COO, CFO, and Chief Legal Officer, have departed. The Winklevoss twins stated the moves were necessary due to an organizational structure that was "stretched thin" and driving up costs.
The stock's weakness highlights a growing decoupling from the crypto market rally. While Bitcoin and Ethereum rebounded in mid-March 2026, and competitor Coinbase (COIN) traded above $200, GEMI continued to slide, opening near $5.95. This underperformance signals that institutions and traders currently prefer direct exposure to major cryptocurrencies or the market-leading exchange, viewing GEMI as a "second-tier, execution-risk bet" dependent on management delivering actual earnings leverage.
