What the Gemtrade Acquisition means for Gemforex Traders

Gemtrade LLC operates GemForex, a foreign exchange trading platform active primarily in Japan. GemForex is a large and popular exchange, but ran into difficulties in 2022 when it suffered problems related to the fraudulent actions of three outside parties.

The simultaneous events of a rampant abuse of bonuses by a third-party group, the embezzlement of company funds by a payment processing company and unpaid funds by a second payment processing company led to liquidity problems and financial difficulties for Gemforex. On 31st May 2023 Gemtrade management were forced to take the decision to suspend trading on the exchange and halt trader withdrawals. All accounts on Gemforex had to undergo forced settlement and all open positions were closed. Trading on the exchange remains suspended.

Galaxy DAO is launching Trade Planets, a trading exchange initially focused on forex derivative trading products (detailed above in heading 4) and in order to scale quickly Galaxy DAO need to secure a large number of unique users. Acquiring Gemtrade LLC allows the DAO to do this in a short timeframe and scale user-base rapidly, hence the reason for Galaxy DAO’s acquisition of Gemtrade LLC.

After the acquisition, Gemtrade LLC will be totally absorbed into Galaxy DAO and the Gemforex trading platform will no longer exist. Galaxy DAO recognises the stress and aggravation caused to Gemforex traders by suspended trading services and halted withdrawals, and recognises the need to address the issue of traders who still have funds locked within Gemforex.

Galaxy DAO has devised various methods of allowing former Gemforex traders to utilize their deposit amounts and credit rights from Gemforex within the Galaxy DAO and Trade Planets ecosystems. These include issuing tokens to Gemforex traders based on the amount of funds held in their Gemforex trading accounts at the time of forced settlement and when the exchange ceased trading. These tokens will be called GBOND tokens, and will represent traders’ credit rights from Gemforex in the Galaxy DAO ecosystem.

GBOND will be the vehicle for all methods for former Gemforex traders to utilize their credit rights within Galaxy DAO & Trade Planets. Traders will be able to utilize their GBOND tokens for a variety of interest-earning and potential profit-accumulating methods. These methods will include; interest-earning vehicles, lending pools, liquid staking pools, revenue share distributions, first rights to investment opportunities in Launchpad start-up companies, token raffles and allocation to Galaxy DAO governance tokens.

Each method is detailed in the headings below.