Boston-headquartered crypto startup Circle has laid off 30 employees – 10 percent of its workforce – due to regulatory uncertainties, Coindesk reported on May 21.
Confirming this move, a spokesperson of the company told the publication: “We made these changes in response to new market conditions, most importantly, an increasingly restrictive regulatory climate in the United States.”
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“Circle remains strong and healthy, and we will continue to drive new product innovation and growth globally, working with jurisdictions that offer forward-looking policies regulating digital asset businesses, while we press for more balanced crypto policy in the US.”
The report also specified that most of the cuts were made in the headquarters of the company, whereas at its New York office, the layoffs were reportedly spread across the finance and product departments. In addition, the Goldman Sachs-backed company also closed some unfilled positions without hiring any new staff.
Founded in 2013, Circle operates an over-the-counter (OTC) desk for crypto trades targeted towards the institutional investors. Over the years, the company has raised around $250 million and is heavily backed by Bitmain, IDG Global, and Goldman Sachs.
Last year, the fintech company acquired Poloniex, a US-based crypto exchange, in one of the largest deals in the crypto industry. Though neither parties disclosed the exact amount of the deal, some industry experts believe that it involved around $400 million. Moreover, to pave the way to become a Securities and Commission Exchange (SEC)-regulated broker-dealer, Circle recently acquired the investment crowdfunding platform SeedInvest.
Increasing regulatory concerns
Amid regulatory concerns in the United States market, Circle-operated Poloniex recently limited the trading of 9 digital assets to non-US markets only.
Elaborating the move of “geo-fencing,” Jeremy Allaire, CEO of the crypto startup, wrote: “We are deeply frustrated that we needed to take these steps, but they are the direct result of the signaling from the recent guidance, in which US regulators are taking an extremely broad view of what crypto assets might be deemed securities.”
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