Digital asset manager Osprey Funds lays off staff as crypto winter fallout continues

Digital asset manager Osprey Funds has laid off 15 employees and is currently operating with fewer than 10 employees, including four members of its leadership team, a source familiar with the matter tells Yahoo Finance.

“Osprey had layoffs last summer and fall aligned with the downturn in the crypto market, however Osprey remains strong,” Osprey Funds CEO Greg King told Yahoo Finance over email.

Osprey’s Bitcoin Trust (OBTC)which is available at online brokers Fidelity, Charles Schwab, and TD Ameritrade, had approximately $46.9 million in assets under management as of Friday, Jan. 6.

Including its BNB, Solana, Polkadot, and Algorand trusts, the crypto product issuer has $67.6 million in assets under management across its trusts.

Hit by shrinking investor appetite for risky assets, digital asset prices plunged in 2022, leading to the collapse of some heavily-leveraged investors. These impacts continue to ripple through the industry in the form of bankruptcies and layoffs.

Crypto hedge fund Three Arrows Capital filed for bankruptcy at the beginning of July after facing numerous margin calls. Voyager Digital and Celsius Network followed with filings for Chapter 11 shortly after, putting thousands of retail investors on the hook for their deposited funds.

In November, crypto exchange FTX filed for bankruptcy. Court documents show the exchange used customer funds to make up for losses taken by interconnected hedge fund Alameda Research.

Former FTX chief executive Sam Bankman-Fried (C) arrives to enter a plea before US District Judge Lewis Kaplan in the Manhattan federal court, New York, January 3, 2023. (Photo by Timothy A. CLARY / AFP) (Photo by TIMOTHY A. CLARY/AFP via Getty Images)

A fund flow report from digital asset product issuer CoinShares published Monday showed flows to crypto products over the past week have “continued mild negative sentiment that has persisted” into 2023, with short bitcoin investment products seeing minor inflows of $1.2 million last week.

And Osprey’s cuts are but one example of a much wider trend in crypto layoffs.

On April 12, Osprey listed 22 employees on its website. By August 15, that number had fallen to 19; as of November 28, the number had fallen to just 4 executives. Osprey had previously tried launching a hedge fund in August, the source said, but the company told employees its latest cuts came due to the hedge fund’s failed launch.

Crypto firms cut almost 9,500 workers through 2022 according to an annual report from The Block Research. The figure included major exchanges such as Crypto.com (2,260), Coinbase (1,160), Kraken (1,100), Robinhood (1,060), as well as lenders Celsius (150) and BlockFi (250), which has also since filed for bankruptcy.

Based on data from layoffs.fyi compiled by The Block, the tech industry saw approximately 151,600 job cuts through 2022, with crypto job losses contributing to 6.2% of the total.

And the industry’s job cuts appear far from over.

Early Friday morning it was revealed the Asia-based crypto exchange Huobi plans to cut its staff by 20%. In a statement given to Yahoo Finance a Huobi spokesperson the “personnel optimization” is intended to “optimize structure” and “improve efficiency” so the veteran crypto exchange can “return to the top three” exchanges by trading volume. Huobi previously laid off some 300 employees last year.

Last Thursday, crypto lender Genesis laid off 30% of its workforce, leaving 145 employees at the troubled crypto lending firm. That decision followed the resignation of its CEO, Michael Moro, along with new leadership hires.

The same day, a spokesperson for its parent company Digital Currency Digital Currency Group (DCG) confirmed it was closing its wealth management division, HQ, as of the end of January. The story was first reported by The Information.

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