May 26, 2022

Derivatives-focused cryptocurrency exchange BitMEX laid off about 75 employees, or a quarter of the company’s employees, days after its founders planned to acquire a German bank. Employees learned of the cuts last week, reports The Block.

A BitMEX spokesperson told The Block that the platform will continue to operate “as usual” for the company.[s] For the next phase of our business.”

BitMEX CEO Alexander Hauptner and CFO Stefan Lutz announced in January that they plan to buy one of Germany’s oldest lenders, Bankhaus von der Heidt. They planned to acquire the bank through BXM Operations, which the couple co-founded. German media first reported last week that both parties had mutually agreed not to proceed with the transaction, which was later confirmed by BitMEX, though the company did not share details of the reasons.

Munich-based Bankhaus von der Heydt, founded in 1754, is one of the first regulated institutions in Germany to offer digital asset services, according to Coindesk.

The layoffs come weeks after BitMEX co-founders Arthur Hayes, Ben Delo and Samuel Reed agreed to pay a $10 million fine for willfully failing to comply with basic anti-money laundering regulations. The co-founders allowed BitMEX to operate in the shadow of the financial markets, U.S. Attorney for the Southern District of New York Damian Williams wrote in a statement.

Hayes stepped down from his previous position as CEO of BitMEX in October 2020, although sources told The Block that he played a role in the layoffs due to his support of BitMEX due to his primary focus on derivatives.

Previously known as a Bitcoin-only derivatives platform, the exchange has expanded into Ethereum products and added offerings in spot trading, brokerage, custodianship, and educational content as part of a rollout that began in late 2020. It was then that Hoptner joined to replace Hess as CEO. ,

It added to these new opportunities and saw the acquisition as part of an effort to reposition itself as one of the top 10 crypto exchanges by volume. According to crypto data provider Nomics, BitMEX had a total turnover of $1.34 billion, compared to $69.4 billion on Binance, the world’s largest crypto exchange by that metric.

Even though only three-quarters of the workforce remained even after the cuts, it remains to be seen whether BitMEX’s efforts to attract more traders to its platform will be fruitful.

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