The crypto bank Anchorage Digital is the latest industry participant to slash staff as the sector continues to grapple with a major market downturn for digital assets. The financial services startup said Tuesday that it is laying off about 20% of its staff, or 75 people, and cited the uncertain crypto regulatory landscape in the US as a factor in its decision.
(Bloomberg) — The crypto bank Anchorage Digital is the latest industry participant to slash staff as the sector continues to grapple with a major market downturn for digital assets. The financial services startup said Tuesday that it is laying off about 20% of its staff, or 75 people, and cited the uncertain crypto regulatory landscape in the US as a factor in its decision.
Coinbase Global Inc., Blockchain.com, Genesis and Crypto.com also laid off employees in 2023, leading to more than 2,000 job cuts so far this year. San Francisco-based Anchorage said in its statement that broad macroeconomic challenges and the volatility of the crypto market also pushed it to shed staff.
Anchorage said its banking subsidiary was unaffected by the layoffs. “Anchorage Digital Bank — a nationally chartered trust bank and subsidiary of Anchorage Digital — has a segregated capital base and continues to be well-capitalized, and is not affected by this move,” a spokesperson told Bloomberg by email. “We are investing in and growing our bank staff to gear up for increased demand since we are the only unequivocal qualified custodian for digital assets per the proposed SEC custody rule.”
The first federally chartered crypto bank in the US, Anchorage previously raised $350 million at a more than $3 billion valuation from investors led by private equity firm KKR & Co. in 2021. The company has clashed with US regulators, though. The Office of the Comptroller of the Currency said in April that Anchorage did not have key money-laundering controls in place and that its compliance program lacked staff and internal processes to verify customers in 2021.
Anchorage’s staff cuts are just the latest setback for the crypto banking sector. Crypto-friendly Signature Bank was seized by the government on Sunday after regulators lost faith in management. Silvergate Capital Corp., which was once known for running the bank of choice for crypto companies, said earlier this month that it is working on winding down its operations and liquidating its bank after it faced regulatory scrutiny, major losses and the shutdown of its crypto payments network.
“The need for better crypto infrastructure is growing ever clearer,” Anchorage said in a statement to Bloomberg News. “For us, that means focusing resolutely on our status as an unequivocal qualified custodian, among other safe and regulated ways for institutions to participate in the digital asset ecosystem.”
–With assistance from Muyao Shen.
(Updates with additional company comment about the scope of the layoffs in the third paragraph.)
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