Anchorage Digital has become the latest firm in the digital asset sector to announce job cuts since the start of the year. In a statement, the California-based virtual asset platform laid off 75 employees in a move that it says will ensure its corporate survival.
The cuts amount to 20% of Anchorage Digital’s workforce and take the form of an internal restructuring as it navigates uncertain times. Anchorage Digital remarks that falling demand and prices for digital currencies like non-fungible tokens (NFTs) contributed to its decision to reduce its headcount.
Aside from the market’s volatility, other factors that played a role in the firm’s decision include regulatory uncertainty and pressing global macroeconomic challenges. Anchorage Digital clarified that the layoffs do not stem from financial challenges, saying that it remains in good financial standing and is not affected by the collapses of Silvergate and Signature Bank.
“However, these same macroeconomic, market and regulatory dynamics are creating headwinds for our business and the crypto industry,” read the company statement. “Against that backdrop, we have restructured our team and will be parting with 75 employees (approximately 20% of our team).”
Going forward, the company noted that the restructuring would allow it to focus its attention on the services that are of interest to its growing customers. Furthermore, Anchorage Digital confirmed that it will be building a suite of solutions for digital asset holders on the platform while promising that there will be no interruption of services.
“Anchorage Digital will be executing these actions in a seamless manner for our clients and with all appropriate support for our team members. Our clients should experience no disruption in service, and we are also communicating with them directly,” the company said.
Just another day in the ‘cryptoverse’
Job cuts in the digital asset industry have become commonplace in 2023, with over 3,000 individuals losing their roles before the end of Q1. Large centralized exchanges like Crypto.com, Coinbase (NASDAQ: COIN), and Bittrex have announced double-digit headcount reductions since the start of the year, with smaller operators toeing the same path.
“While crypto companies, in general, have been hit hard by the onset of crypto winter amid a tough macroeconomic environment, layoffs have revealed that exchanges, in particular, have been ‘swimming naked’ and can no longer sustain their previous excesses,” CoinGecko COO Bobby Ong said.
A common denominator for the over 20 layoffs appears to be a deteriorating market sentiment and regulatory uncertainty. Several firms with layoffs appear to have exposure to the failures of large industry entities like FTX, Celsius, and Three Arrows Capital.
Watch: The Future of Digital Asset Exchanges & Investment
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