Digital asset bank, Anchorage Digital has announced its decision to part with 75 employees, about 20% of its workforce. The bank gave statements that its decision is based on ongoing uncertainty surrounding regulatory frameworks for crypto-related businesses in the US.
Anchorage added that it needed to position itself strategically as a digital asset custodian in the ever-evolving crypto industry. The crypto bank also mentioned macroeconomic challenges and crypto market volatility as factors for the personnel cut.
Furthermore, the crypto bank highlighted that the current restructuring aims to strengthen areas of its business that are of utmost importance to its clients. Although it may be expected that the layoffs may affect the bank’s operations, Anchorage has reassured both its clients and staff that there would be no disruptions in service.
The layoffs occur when the US financial industry is in chaos following the failure of three regional banks in a single week. However, uncertainty exists whether Anchorage’s decision to reduce its staffing was influenced by recent events involving Silver Valley Bank, Signature, and Silvergate.
Markedly, Huobi Global recently announced its decision to reduce its headcount by 20%, citing restructuring plans.
The Need for Clear Crypto Regulations
While it is not uncommon for companies operating in the crypto industry to be affected by regulatory uncertainty, regulatory clarity is essential for the long-term sustainability and growth of the crypto industry. This is because it provides a predictable and stable environment for companies to operate in.
Without clear guidelines, businesses in the crypto space may find it challenging to navigate compliance requirements and maintain stable operations. Against this backdrop, regulators in Japan have urged international policymakers to adopt crypto regulations. The regulators advised that the regulation of digital assets be tightened similarly to those in the financial sector.
It is important to note that regulatory uncertainty is not unique to the crypto industry, and many emerging industries face similar challenges. Businesses that operate in heavily regulated sectors like banking and healthcare also have major compliance challenges and unpredictability.
