Crypto Broker Genesis Cuts 20% Workforce, CEO Michael Moro Stepping Down
Nicholas Otieno Aug 18, 2022 04:00
Genesis is laying off 20% of its 260-strong workforce, and its CEO is leaving. The announcement comes after the firm lost money that it loaned to the insolvent hedge fund Three Arrows Capital.
Genesis, a major institutional digital asset market and a full-service digital currency prime brokerage based in New York, on Wednesday announced several leadership changes amid the company’s efforts to boost the next phase of its growth.
Genesis disclosed that its CEO Michael Moro is stepping down, and the firm is slashing 20% of its 260-person workforce. The cut of 20% equates to the loss of around 52 jobs.
The downsizing exercise comes a few months after Genesis reported huge losses tied to the collapse of Three Arrows Capital (3AC) in June.
Derar Islim, the Chief Operating Officer at Genesis, will take over as interim CEO while the firm searches for a permanent replacement.
The company said that Moro, who joined Genesis in 2015 and took over as CEO the following year, will stay on during the leadership transition.
Besides that, Genesis said it recently hired new executives as chief risk officer, chief compliance officer, and chief technology officer to strengthen its governance further and position the company for the future.
Genesis is a subsidiary of Digital Currency Group, a global enterprise that builds, purchases, and invests in blockchain firms worldwide.
Genesis started its crypto trading desk and lending business in 2013, when Bitcoin was trading just around $80. The New York-based firm is among the largest trading platforms in the crypto market.
Genesis facilitated significantly superior transactions last year when crypto markets were booming. The company’s loan originations soared more than sevenfold to $131 billion, and the firm increased its workforce by 22% to 170 employees. By mid this year, the company’s headcount rose to 260.
The rapid crash in the crypto market this year wiped out companies whose businesses were tied directly to the values of crypto assets. Firms, including Hedge fund Three Arrows Capital (3AC), Voyager Digital, and Celsius Networks, among others, filed for bankruptcy after facing financial challenges triggered by volatile market conditions.
Although Genesis weathered the storm better than other participants in the market, the company suffered massive losses due to its exposure to 3AC.
In July, Genesis filed a $1.2 billion claim against the now insolvent Three Arrows Capital because of breached loans.
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