Leading Canadian cryptocurrency exchange Coinsquare has reportedly laid off almost a third of its staff. The news comes after at least five other trading platforms found themselves in trouble during the past month. From the need to adapt to a prolonged bear market, overcome financial difficulties and technical issues, to coping with coin losses and hacker attacks, the dawn of 2019 has exposed some of the acute challenges the industry is facing.
Also read: Crypto-Stealing SIM Swapper Pleads Guilty, Gets 10 Years in Prison
2 Executives Among Terminated Coinsquare Employees
One of the leading digital asset exchanges in Canada, Coinsquare, has recently decided to lay off approximately 40 out 150 staff members, Betakit reported, quoting multiple sources. Among the people in different roles whose contracts have been terminated are two key executives – COO Robert Mueller, who joined Coinsquare about a year ago, and CFO Ken Tsang, an investment banker formerly employed by major financial institutions such as Bank of Montreal and Bank of Canada. The company’s Head of Talent Martin Hauck announced on Linkedin:
The ever-evolving cryptocurrency space has been volatile and unpredictable. Many similar companies in our industry have had to make some tough choices in recent months and Coinsquare has had to as well. The company has made the decision to part ways with a number of talented members of the Coinsquare team.
The latest round of layoffs at Coinsquare comes after approximately 20 employees across various departments were terminated in July of last year. The company has been trying to restructure and even expand its business. In December, it entered 25 new markets in the European Union and last summer launched a crypto trading platform in Japan. It entered into partnerships with global blockchain investment bank Dlta 21 and the Bank of Montreal.
In December, the company also acquired crypto wallet provider Blockeq for $12 million. And despite the layoffs, the exchange has also hired over 20 new employees, Coinsquare CEO Cole Diamond revealed. This includes 14 people who joined the team after the acquisition of Tipcoin, a company that develops a blockchain-based loyalty rewards platform.
The executive added that in “the most volatile market,” the company’s staff grew from three people to a high of 150. “We’ve decided to make some cutbacks to make sure we protect our strong position in the market,” he explained, noting the challenges other Canadian exchanges are facing and the fact that Coinsquare’s main competitor in the country, Quadrigacx, is now offline.
5 Other Crypto Exchanges in Trouble
In recent weeks, there have been multiple reports about exchanges experiencing various difficulties that have led to their temporary or permanent closure. Quadrigacx is indeed one of the troubled crypto trading platforms. The exchange filed for insolvency and applied for creditor protection with the Nova Scotia Supreme Court. It has lost access to “significant cryptocurrency reserves held in cold wallets” after the death of its CEO Gerald Cotton. In total, $145 million worth of digital assets is missing.
Financial problems have dogged other crypto exchanges. Coinpulse announced recently it’s going into “indefinite maintenance” after negotiations with a potential investor took longer than expected. The platform suspended trading and deposits on Feb. 1 and said it will keep withdrawals open only until Feb. 7. Last week, the small Ukrainian exchange Liqui informed users it’s no longer able to provide liquidity. Its team asked clients to withdraw their funds within a month.
Roobit, a young South Korean cryptocurrency exchange, has also filed for bankruptcy less than three months after its launch. According to local media, technical issues that led to financial losses are behind its decision to discontinue operations. A representative of the exchange stated in a Kakao Talk chat that “it is difficult to operate with a loss of 400 million won ($360,000) due to a system error” that resulted in wrong payments. Around 800 crypto investors have suffered losses, Sisafocus reported.
In mid-January, New Zealand-based exchange Cryptopia became the latest victim of a security breach when hackers reportedly stole around $16 million worth of cryptocurrency. Despite the ongoing police investigation, the unknown attackers managed to withdraw 1,675 ETH more from 17,000 Cryptopia wallets, according to research conducted by the data company Elementus.
What are your expectations for the future of crypto exchanges? Share your thoughts in the comments section below.
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