Blockchain.com Cuts 25% of Staff Amid Three Arrows Capital Contagion
2022.07.22 15:34
Blockchain.com Cuts 25% of Staff Amid Three Arrows Capital Contagion
- Blockchain.com has joined the list of crypto companies cutting staff.
- The company had exposed over $270M to the now insolvent Three Arrows Capital (3AC).
- The founders of Three Arrows Capital are being held by authorities in Dubai, UAE.
Popular American crypto exchange Blockchain.com has decided to lay off 25% of its workforce, citing extreme market conditions. Representatives of the company also revealed a $270 million deficit caused by the Three Arrows Capital (3AC) incident.
NEWS UPDATE: Another #Crypto company is cutting staff in the midst of the winter, as https://t.co/VhSF1e1YyA announces 25% cut of their workforce. #Blockchain #CryptoNews #Layoffs
— Gokhshtein Media (@gokhshteinmedia) July 21, 2022
Don’t Cry for Blockchain.com, Argentina
Prior to this development, Blockchain.com had been expanding, increasing its ranks from 150 employees to around 600 within the last year and a half. The Luxembourg-based crypto platform started its journey 10 years ago, when the firm, formerly known as ‘Blockchain.info’, was founded in York, United Kingdom.
The tables have since turned, and the crypto trading platform has been forced to return to its January 2022 staff levels. Some areas of the company were more heavily affected than others, with the Argentinian branch being closed altogether. Nearly half of the affected employees were from Argentina itself, with the others coming mostly from the United States and the United Kingdom.
Ultimately, Blockchain.com elected to exit the Argentinian market because of its relatively low demand, while Blockchain.com’s services are much more sought after in Western Europe, The United States & Africa, according to company executives.
Blockchain.com Tightening Its Belts
The management of Blockchain.com revealed several other changes that would be carried out in relation to the reduction. The modifications include:
- Suspension of institutional lending services.
- Termination of all mergers and acquisitions.
- Postponed launch of the NFT marketplace.
- Reduction in CEO compensation.
- Reduction in executive salaries.
Blockchain.com has seemingly adopted similar tactics to Coinbase (NASDAQ:COIN), which also laid off a significant portion of its staff in the U.S. Moreover, other popular crypto exchanges, such as Crypto.com and Gemini, also reduced their headcounts by 10%.
Three Arrows Capital Founders Break the Silence
In related news, Three Arrows Capital founders Su Zhu and Kyle Davies broke their silence, expressing their regret about the “contagious” situation, according to Bloomberg. “The whole situation is regrettable”, lamented Kyle Davies, fully acknowledging the Domino effect that the demise of their company was having on the crypto market.
EXCLUSIVE: After weeks in hiding, the disgraced founders of Three Arrows Capital finally speak exclusively about the spectacular implosion of their once high-flying hedge fund https://t.co/ExL5JDvEkI pic.twitter.com/kMyDRLGAMk
— Bloomberg Crypto (@crypto) July 22, 2022
Su Zhu also touched on the sensitive subject of the luxury yacht, which was planned for delivered to Italy after the pair put down a $50 million down payment. “It was bought over a year ago and commissioned to be built and to be used in Europe” Su Zhu explained.
The far-reaching destruction caused by the collapse of Do Kwon’s Terra (LUNA) set Three Arrows Capital back an eye-watering $600 million. Su Zhu was contrite on the subject. He said: “What we failed to realize was that Luna was capable of falling to effective zero in a matter of days”. Finally, the Co-Founders expressed their regret at forming personal ties with Do Kwon, as they falsely came to believe that “big things” were about to happen as a result.
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