Crypto Bank Anchorage Digital Cutting Workforce By 20%
The only federally chartered crypto bank in the US, Anchorage Digital, revealed on Tuesday it is “initiating a strategic realignment” which will involve reducing its workforce by 20%. The press release cited regulatory conditions in the United States as one of the key reasons behind the decision.
Anchorage Digital Reducing Staff By 20%
In a statement published on Tuesday under the title “Focusing for the Future”, Anchorage Digital, the only federally chartered crypto bank in the US, announced it is “initiating a strategic realignment” which will entail the firing of 70 workers—20% of the total staff. According to the release, the decision is the result of “an evolving landscape facing the crypto industry”, market volatility, regulatory uncertainty, and other broader economic factors. The company, however, also expressed its commitment to its mission and stated it remains optimistic about the future:
Rather, this restructuring is aimed at fueling the parts of our business that are most essential to our clients in the current and anticipated marketplace. In doing so, Anchorage Digital will be able to serve the growing demand to build regulated solutions for digital asset holders. 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. Looking ahead, we remain optimistic about the digital economy and our place within it. We’re particularly confident that our status as an unequivocal qualified custodian for digital assets will position Anchorage Digital for what’s ahead.
Throughout February, there has been a notable spike in regulatory activity aimed at the cryptocurrency industry—on the federal, as well as state levels. New York state regulators have been particularly active with their most recent action targeting the cryptocurrency exchange. The SEC has, as was the case throughout 2022, also heightened its activity and has targeted both the stablecoin BUSD, and Kraken’s crypto staking service. Coinbase’s CEO Briant Armstrong even hinted that the recent actions were a prelude to an outright ban on cryptocurrency staking in the US.
Digital asset-related banking has also taken a significant hit in 2023. While the downfall of Silvergate bank didn’t come as a surprise as its woes became somewhat self-evident in early January, it wasn’t the only crypto-friendly bank to close this month. In a surprise move, US watchdogs shut Signature Bank down citing “systematic risks”, though one of the company’s board members stated the move was meant as a warning to the industry against dabbling with digital assets.
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Mass Layoffs Continue Into March
While the very beginning of 2023 saw a major cryptocurrency rally which sparked hopes the “crypto winter” was finally over, it has also so far proven to be a tumultuous year for the industry. As a result, multiple cryptocurrency companies initiated rounds of layoffs of various scopes.
Already in early January, both Coinbase and Huobi announced plans to cut their workforce, in large part due to the turmoil caused by the collapse of FTX. Later in the month, Gemini and Genesis made similar moves as their feud was heading toward the latter’s bankruptcy filing.
Still, despite the layoffs in the cryptocurrency sector, the tech industry proved to be the leader when it comes to firings this year. In February alone, more than 21,000 tech workers were sacked. March is already showing signs it won’t be much better as Meta announced on Tuesday plans to fire 10,000 employees.
Do you think the Anchorage Digital layoffs are connected to the recent closures of Silvergate, Signature, and Silicon Valley Banks? Let us know in the comments below.