Beleaguered cryptocurrency exchange CoinFLEX is undergoing massive layoffs.
“We unfortunately had to let go of a significant number of the CoinFLEX team across all departments and geographies,” company co-founders Sudhu Arumugam and Mark Lamb announced in a blog post this morning.
The staff reduction is significant enough that, combined with non-employee cuts, it will reduce the company’s costs “by approximately 50-60%,” the co-founders wrote. Remaining employees will be focused exclusively on product and technology.
The news comes after a weakening month for the cryptocurrency exchange, which froze all customer withdrawals at the end of June. Unlike the multitude of other cryptocurrency firms and exchanges that similarly froze customer accounts during the same period – due to questionable financial practices and consequences of today’s bear market—CoinFLEX claims it is in dire straits due to an $84 million loss to the company of a single “large individual customer.”
That customer, according to CoinFLEX co-founder Mark Lamb, is prominent Bitcoin evangelist Roger Ver. Earlier this month, CoinFLEX went to arbitration with Ver in a Hong Kong court to try to recover these funds, but a judgment is not expected for another 11 months. Ver, who earned the moniker “Bitcoin Jesus” as an early proponent of the cryptocurrency, has vehemently denied the claim that he owes the company any money.
Since then, CoinFLEX has created 10% of user funds available for withdrawal. But the vast majority of customer deposits are still unavailable.
As a result, the stock exchange has been forced to make massive cuts in wages and expenses, as current developments show. In today’s blog post, Arumugam and Lamb alluded to the fact that the company hopes a larger firm will step in to remedy the situation.
“The intent is to remain the right size for any entity considering a potential acquisition or partnership opportunity with CoinFLEX,” the two co-founders said.
As many crypto companies have started to fold cascading domino effectindustry titans—notably FTX CEO Sam Bankman-Fried—has rushed to rescue and acquire many of themin an effort to mitigate the damage to the broader crypto industry and market.
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