Crypto custody provider BitGo has laid off 12% of its workforce, the firm said Friday.
According to sources, the layoffs spanned various business units, including marketing and sales. The layoffs are the latest to hit the cryptocurrency industry, as other firms have let staff go amid a challenging business environment.
Analytic firms Chainalysis, Elliptic, and CipherTrace have either laid off staff or cut salaries because of the economic impact of the coronavirus pandemic, as The Block reported late last week.
A representative for BitGo confirmed the layoffs when reached for comment, telling The Block:
"BitGo's evolution to become a digital asset financial services firm for the institutional market has accelerated with two acquisitions in the last quarter. As we move into new markets with new products and services, we are making changes to strengthen the business and reorganize our teams. We have made the difficult decision to let go of a small number of people totaling 12% of our workforce. It is never easy to make a decision like this and we have deep gratitude for the contributions and talent of those affected."
The layoffs at BitGo follow news yesterday that the firm acquired tax management platform Lumina. BitGo also recently acquired Harbor, the security token issuance platform. Harbor, Lumina, and BitGo share an investor in David Sacks, who leads venture capital firm Craft Ventures.
BitGo has been taking steps to grow beyond just serving as a custody platform. The firm announced the launch of a lending business earlier this year. Last October, BitGo acquired staking infrastructure provider Hedge. Sources say BitGo is moving in the direction of building out a full-scale prime broker, which would allow clients of its custody business to trade across markets.
Still, sources have questioned the viability of BitGo expanding into trading and lending as it would pin them against many of their wallet clients.
BitGo counts a number of investors as backers, including Goldman Sachs and Mike Novogratz's Galaxy. As reported by Bloomberg News, the firms contributed around $15 million to BitGo’s 2018 Series B fundraise.
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