A major U.S.-based cryptocurrency exchange is reducing its presence in Latin America and is also suspending expansion in games and non-fungible tokens.
Blockchain.com is laying off 25% of its employees, which is about 150 people, due to “harsh market conditions.” In addition, the company stressed the need to cover financial losses: the exchange currently has a $270 million shortfall from lending to hedge fund Three Arrow Capital.
The exchange has announced that it will close its offices in South America, as well as cancel plans to expand the team in several countries. About 44% of the laid-off employees are located in Argentina, 26% in the US and 16% in the UK, according to company statistics. One of the experts of the CoinDesk publication said that such changes will return the company to the state of January 2022.
Blockchain.com says that the greatest demand for its services comes from the US, Europe and Africa, not Latin America. Also, exchange clients most often use brokerage services than any other.
Over the past 16 months, the company has increased its staff from 150 to 600 employees. The efforts that the company is making to accumulate funds, level the consequences of the collapse of Three Arrow Capital, top managers assure. In addition, the company is downsizing its institutional lending business and halting all M&A transactions, as well as suspending its gaming and NFT business expansion activities.
Top management salaries and CEO compensation are also being cut, a company spokesman said. Consumer incomes remain active and high; Institutional income has not changed but has not risen either and will need time to recover, the spokesman added.
Recall that earlier the crypto exchange announced that it intends to file an application for a public offering of shares (IPO) with the US Securities and Exchange Commission (SEC) this year.
Source: Bits
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