Is another bank with deep ties to the crypto sector about to fold? Anchorage Digital, a federally regulated digital assets bank, just announced some heartbreaking news.
Anchorage Digital, the first federally-chartered digital asset bank, announced on March 14th that it was laying off 20% of its workforce. According to the bank, the layoffs were precipitated by regulatory uncertainty.
The announcement stated that the layoffs were "a strategic realignment to better focus our resources." It cited crypto market volatility and macroeconomic challenges as the other reason for the decision.
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The bank stated that the current crypto market conditions had increased demand for its products, adding that client assets under its management were at "an all-time high."
However, in its announcement, the bank noted:
These same macroeconomic, market, and regulatory dynamics are creating headwinds for our business and the crypto industry.
Anchorage Digital offers crypto lending and staking services, which are areas where regulators have been increasingly scrutinizing.
The cuts come in the wake of the closure of Silicon Valley Bank, Signature, and Silvergate Bank. The three banks had deep ties to the crypto and fintech world, which has caused fear amongst many crypto investors that more banks could be on the way out.
Since the collapse of Silvergate and Signature, crypto startups have been working overtime to form new banking relationships. Stablecoin issuer Circle chose New Jersey-based Cross River Bank as its new banking partner.
To date, Anchorage Bank is the only federally chartered bank licensed to offer crypto custody services by the Office of the Comptroller of the Currency.
