Crypto brokerage Genesis laid off roughly 30% of its workforce Thursday, or about 60 employees.
“As we continue to navigate unprecedented industry challenges, Genesis has made the difficult decision to reduce our headcount globally,” a Genesis spokesperson told The Wall Street Journal and Bloomberg in an emailed statement. “These measures are part of our ongoing efforts to move our business forward.”
The company counts 145 employees after the cuts, a spokesperson said.
The latest headcount reduction marks at least Genesis’ second round since August, when the company eliminated 20% of its positions. The brokerage’s CEO, Michael Moro, stepped down at that point.
Between August and October, however, Genesis lost at least five senior-level executives: Matt Ballensweig, its co-head of sales and trading; Michael Paleokrassas, its managing director of trading; Reed Werbitt, its head of cash trading; Joshua Lim, its head of derivatives; and Michael Patchen, its chief risk officer.
The November collapse of crypto exchange FTX triggered a liquidity crunch at Genesis. The brokerage paused loan originations and redemptions that month. But that move raised the ire of crypto exchange Gemini, whose customers hold $900 million of the trapped funds.
Genesis has sought an emergency $1 billion loan from investors, and also has tried to raise capital from crypto exchange Binance and private-equity firm Apollo Global Management, The Wall Street Journal reported.
Interim CEO Derar Islim said Wednesday that Genesis needs more time to resolve the woes in its lending unit but has made progress in reducing costs in its business lines.
Genesis is working with investment bank Moelis & Co. to evaluate its options, including a potential Chapter 11 bankruptcy filing, people familiar with the matter told the Journal. Genesis warned in November that it was considering bankruptcy.
The brokerage is hardly the only crypto-connected company to announce double-digit percentage-point staff cuts this week. Seychelles-based crypto exchange Huobi announced plans Friday to lay off 20% of its staff. Meanwhile, crypto-heavy bank Silvergate Capital said Thursday it would cut 40% of its workforce.
Genesis’ August job cuts followed steep losses from loans it made to FTX sister company Alameda Research and crypto hedge fund Three Arrows Capital, both of which filed for bankruptcy.
Genesis reportedly loaned Three Arrows $2.4 billion with 50% collateral. Moro, however, said the collateral was closer to 80%, according to The Wall Street Journal.
