Blockchain.Com ends asset management after less than a year: Report
Blockchain.com started as the first Bitcoin blockchain explorer back in 2011 and later expanded into wallet services, as well as hosting its own crypto exchange.
After years of growth, the company decided that 2022 was the year they would expand into asset management services. Unfortunately, the years of experience did not save the company from the bear market.
Operational for less than a year
Blockchain.com, which was worth about $14 billion when BCAM launched, created the asset management service in partnership with Altis Partners.
Aimed at high-net-worth individuals and institutional investors, the service debunked the idea of investing in cryptocurrency with less risk due to “algorithmic risk-managed exposure” – a bunch of words that don’t mean much, considering trades, crypto or not, are made by using algorithms. Margin calls, for example, are technically based on an algorithm that reduces the risk for the broker.
At the time, Charlie McGarraugh, the chief strategy officer at Blockchain.com, believed that the newly formed asset management arm was a great opportunity for investors around the world.
“Like everything in crypto, you won’t know until you try. But like everything in crypto, we think we’re growing into the clear blue sky. It’s a big opportunity.”
Unfortunately, the timing was notoriously bad. After barely a year – 11 months, to be precise – of the aforementioned exposure, BCAM submitted a request to be struck off the UK company register, according to Bloomberg.
Crypto Winter to blame
According to a spokesperson for BCAM, the decision to close its doors came after nearly a year of adverse market conditions with little or no relief.
“Blockchain.com Asset Management was launched in April 2022, shortly before macroeconomic conditions deteriorated rapidly. With the crypto winter now approaching the one-year mark, we made the business decision to pause operations of this institutional product.”
This makes Blockchain.com the latest victim of crypto winter – although, much like Silvergate’s decision to liquidate earlier this week – it appears to be in an orderly manner, without the need for bankruptcy proceedings as in the case of TerraformLabs, Voyager, FTX and others.
Currently, there is no information available on how or exactly when the company will cease operations and how it will liquidate all active assets to return them to customers.
