Crypto Market Struggles Continue: Layoffs and Bankruptcies Plague Industry

The cryptocurrency market has faced significant bearish pressure over the past year, leading to a total capitalization of under $900 billion after reaching an all-time high of $3 trillion in 2021. Many companies, including exchanges, have filed for bankruptcy or collapsed, causing a contagion effect and deterring new investors. In response to the market downturn, exchanges including Coinbase, Kraken, and Bybit have laid off staff, with over 26,000 layoffs in the industry in the first eleven months of the year. Other companies such as Swyftx, Lemon Cash, and Unchained Capital have also reduced their workforce due to the lack of a clear recovery horizon in the market. On Monday, Coinbase announced it was laying off 950 employees or 20% of the exchange’s workforce. The stock rose after the news, tracking other traditional technology firms like Amazon and Google who have cut staff.

Judge Rules: Celsius Earn Program Funds Belong to Lending Platform

A recent ruling by Judge Martin Glenn has determined that the funds in the Celsius Earn program, totaling over $4 billion, legally belong to Celsius as per their “unambiguous” terms of use. If the funds are found to belong to the debtor, they will be distributed according to a Chapter 11 plan for unsecured creditors. The court has granted Celsius an extension until February 15 to present a Chapter 11 restructuring plan. Additionally, the ruling has allowed for the sale of $18 million worth of stablecoins in the Earn program, as Celsius has shown a valid business justification for the sale.

DCG and Genesis Global Capital Targeted in U.S. Authorities’ Probe

Cryptocurrency company Digital Currency Group (DCG) is being investigated by the US Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) for internal transfers between DCG and its subsidiary crypto lending firm, Genesis Global Capital, according to a report by Bloomberg. The authorities have already requested interviews and documents from both companies, and the SEC is conducting a similar early-stage inquiry. While no indictment has been brought against DCG and no information has been provided by either agency, a spokesperson for DCG has stated that they have “no knowledge of or reason to believe” in the investigation. DCG owns several subsidiaries, including Grayscale Investments, CoinDesk, Luno, and Foundry.