The Block: Gemini now passes second-level security exam conducted by Deloitte

Cryptocurrency exchange and custodian Gemini has said it has passed a second-level security compliance test conducted by “Big Four” auditing firm Deloitte.

Announcing the news on Thursday, Cameron and Tyler Winklevoss-founded Gemini claimed to be the “world’s first” crypto exchange and custodian to have completed the System and Organization Controls (SOC) 2 Type 2 examination.

However, crypto custodian BitGo passed the Type 2 examination in April 2019, after completing the Type 1 in July 2018.

"We are the first exchange AND custodian to receive our SOC 2 Type 2. The review by Deloitte covered both our exchange and custody services," a Gemini spokesperson told The Block.

“SOC 2 examinations are specifically designed to address controls at a service organization relevant to the systems at the service organization used to process users’ data,” according to the American Institute of Certified Public Accountants (AICPA).

Gemini worked with Deloitte for both - the SOC 2 Type 2 and the SOC 2 Type 1 examinations. The firm passed the Type 1 examination in January 2019.

“While a SOC 2 Type 1 evaluates the design and implementation of system controls at a point in time, a SOC 2 Type 2 evaluates whether these system controls have been operating effectively over a period of time,” explained Yusuf Hussain, head of risk at Gemini.

Looking ahead, Gemini said it will complete a SOC 2 Type 2 examination on an annual basis.