Anchorage Digital’s layoffs may be related to the present banking sector instability in the United States. Anchorage Digital, a cryptocurrency bank, announced the layoff of 75 people, or around 20% of its personnel, citing regulatory uncertainty in the United States as a reason for its decision.
In a March 14 statement, Anchorage branded the layoffs as “a strategic realignment to focus our resources better” and referred to “wide macroeconomic issues and crypto market volatility” as leading to their shift in approach.
It stated that market circumstances had increased demand for its product and that customer assets under custody were “at an all-time high,” although it added:
“These same macroeconomic, market, and regulatory dynamics are creating headwinds for our business and the crypto industry.”
Anchorage, the first U.S.-based crypto corporation to be given a national trust bank charter by the Office of the Comptroller of the Currency in January 2021, indicated ongoing faith in the digital asset environment and its capacity to develop “regulated solutions for digital asset holders.”
The layoffs come at a time when the banking industry in the U.S. is in a state of chaos after three regional banks fell in just one week.
Since March 8, Silicon Valley Bank (SVB), Silvergate Bank, and Signature Bank have all failed, causing the Federal Deposit Insurance Corporation (FDIC) to take the unusual step of insuring all client accounts more than the regular $250,000 it typically guarantees for SVB and Signature.
@federalreserve @USTreasury @FDICgov issue statement on actions to protect the U.S. economy by strengthening public confidence in our banking system, ensuring depositors' savings remain safe: https://t.co/YISeTdFPrO— Federal Reserve (@federalreserve) March 12, 2023
It needs to be clarified whether the recent developments involving SVB, Signature, and Silvergate influenced Anchorage’s decision to reduce employees.
Anchorage should have reacted more promptly to Cointelegraph’s request for comment.
Layoffs in the crypto business had decreased significantly since the beginning of the year, when roughly 3,000 positions were slashed by crypto firms such as Coinbase and crypto.com in January, followed by a more moderate 570 layoffs in February.