FirstFT: Crypto Exchanges Cut Jobs Amid Market Turmoil

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The cryptocurrency industry’s searing expansion has turned into a crypto chill as investors dump risky financial assets amid a broader market correction.

The latest sign of a downturn in the digital financial asset industry was an announcement yesterday by Nasdaq-listed exchange Coinbase that was laying off more than 1,000 people, or a fifth of its workforce.

The market value of the world’s 500 largest crypto tokens has fallen from a high of $3.2 billion in November to less than $1 billion this week. Bitcoin, the most popular digital coin, fell from over $64,000 to under $21,000. It is still down 10% today at $20,562.71, according to the FT Wilshire Bitcoin Mixed Price Index.

Crypto investors tend to trade much more actively during bull markets. Now, declining volumes are eating away at once-juicy fee trading by making it easier to trade.

“If there is no trading volume, there is no money. . . it looks like it’s going to be tough for a while,” said Julian Sawyer, former chief executive of crypto trading platform Bitstamp.

Coinbase has expanded to around 6,000 employees from 3,730 at the end of last year as it rides on the exuberance of the crypto markets.

Rivals that have exploded in recent years are also tearing up their growth plans. Crypto exchange Gemini, founded by the Winklevoss brothers, announced in early June that it would lay off 10% of its staff amid “turbulent market conditions”.

In recent days, Crypto.com announced that it will cut 5% of its workforce, or around 260 people, and crypto lending platform BlockFi will lay off a fifth of its workforce, or around 170 people. Brazil’s Mercado Bitcoin also recently laid off 90 people, or about 12% of its employees.

Learn more about cryptocurrencies

  • Celsius network: The crypto investment firm, backed by Canada’s second-largest pension fund and a former Blackstone and Airbnb executive, shocked investors last week by blocking customer withdrawals. Read how he ran the crypto bull run and why it all fell apart.

  • Background: Why are crypto lenders at the heart of the digital asset market?

  • FT Alphaville: What were all those 6,200 Coinbasers doing anyway? Questions seeking answers, in the spirit of DeFi, using decentralized reporting.

Have you been caught up in the cryptocurrency crash? Share your thoughts with us at [email protected] or reply to this e-mail and we may include your reply in a future edition of the newsletter.

Thanks for reading FirstFT Americas and here’s the rest of today’s news — Gordon

1. ECB calls emergency meeting to discuss market turmoil The European Central Bank has started an unscheduled meeting of its rate regulators, sparking speculation that it may announce measures to tackle soaring borrowing costs in weaker eurozone economies. In recent days, the so-called spreads between the bond yields of fiscally weaker eurozone governments such as Italy and Germany have widened.

2. EU takes legal action against UK The European Commission today announced that it is taking legal action against the UK over the implementation of the Northern Ireland Protocol, which governs trade between the province, the EU and the UK . Brussels’ decision follows the publication of legislation by Boris Johnson’s government aimed at tearing up the 2020 Brexit deal with the EU.

3. Apple signs soccer rights deal Apple and Major League Soccer have agreed a broadcast rights package worth $2.5 billion over 10 years, according to people familiar with the matter. The deal follows this year’s agreement between Apple and Major League Baseball to broadcast Friday night games. Starting next year, all live MLS matches will be shown on a dedicated streaming service available on the Apple TV app.

4. Hedge fund backed by a legendary investor Julian Robertson closes New York-based Tiger Legatus Capital Management has closed after nearly 13 years of trading, according to a letter seen by the Financial Times, in the latest sign of tough conditions for managers trying to bet on the rise and fall. decline in stock prices. . The Tiger Legatus shutdown comes as equity hedge funds are off to their worst start to a calendar year on record.

5. US advocacy group in talks to buy Pegasus spyware L3Harris, a top 10 US defense contractor, is in talks to buy the hacking technology behind Pegasus, the military-grade spyware developed by Israeli group NSO. The high-stakes maneuver would put in the hands of the United States a tool that Washington has condemned for enabling transnational repression.

The day ahead

Fed interest rate decision U.S. central bank policymakers will today end talk of taming runaway inflation with what could be the biggest interest rate hike in decades. It will also announce its intention to reduce its mammoth balance sheet by $9 billion – a so-called quantitative tightening. Follow the news and reaction to the decision, scheduled for 2:00 p.m. Eastern Time, on our live blog.

Economic data A drop in auto sales is expected to have weighed on retail sales in May. However, the so-called control group, which excludes automobiles, gasoline, building materials and food services, is expected to have risen 0.5% in May, compared to the previous month when they rose by 1%. U.S. homebuilder confidence is expected to have fallen for the fifth straight month as rising mortgage rates threaten housing affordability for first-time buyers, weakening demand for new homes.

NATO defense meeting Ministers gather in Brussels for the two-day event, including a working dinner with representatives from Finland, Georgia, Sweden, Ukraine and the EU. On the eve of the meeting, Germany offered to station most of the additional 3,500 troops it aims to contribute to the transatlantic alliance on its own soil rather than in Lithuania, significantly softening its initial support for more foreign forces are stationed in the Baltic countries to deter any potential Russian aggression.

What else we read and listen to

Oil vs. Human Rights: Biden’s Controversial Mission to Saudi Arabia President Joe Biden’s decision to visit Saudi Arabia next month and meet with Saudi Crown Prince Mohammed bin Salman is a remarkable turnaround for a president who has vowed to treat the kingdom like an outcast and engage with the king. Salman, and not with his son, MBS.

© FT montage/Reuters/Saudi Royal Court/Bloomberg

The echo of the political errors of the 1970s Unexpectedly high inflation, wars in critical commodity-producing regions, falling real wages, slowing economic growth, fears of monetary policy tightening and turbulence in stock markets: current conditions were also dominant in the global economy 40 years ago, writes Martin Wolf.

‘Wall St’s toughest qualifier’ struggles to regain stature I thought the CFA would prove I was an adult and help me find my financial tribe, writes Laura Noonan, editor of the FT’s financial regulator, who ditched friends, family and parties in her late 20s to study for the revered qualification. But now, she says, finance bosses are ambivalent about the benefits of the CFA and demand for it is falling off a cliff.

Mr. Goldman, Mr. Sex When Financial Times reporter Patricia Nilsson started digging into the porn industry, she made a shocking discovery: no one knew who controlled the world’s biggest pornography company. Now Nilsson and his editor, Alex Barker, are revealing who’s behind it all. Listen to the latest episode of Hot Money, our investigative podcast series about the dark power structures of the porn industry.

Join the FT in partnership with Seismic at Strategies For Dealing With The Great Resignation on June 30 where we will discuss the challenges and opportunities presented by the Great Resignation, with a focus on building and coaching successful sales teams. register today free.

Books

What are your favorite books of 2022? This year’s long-awaited Summer Books series is near – and, as always, we want to hear from you. Use the comments section here to tell us.

The FT's Summer Book series is near

What songs made your heart sing? Or stopped you in your tracks? © Photo by Adam Berry/Getty Images

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