Blockchain.com Suspends Asset Management Operations Amid Crypto Bear Market

Blockchain.com Halts Asset Management Operations

Blockchain.com announced the suspension of its asset management division, marking a significant impact of the ongoing crypto bear market. This move comes 11 months after the division's launch, which targeted institutional clients.

Initial Launch and Strategy

The asset management arm, known as Blockchain.com Asset Management (BCAM), was based in London. It was established in collaboration with Altis Partners, focusing on Bitcoin price tracking versus the dollar. The initial strategy included offering algorithm-based risk-managed exposure to Bitcoin and managing token exposure in decentralized finance.

Impact of the Crypto Winter

The decision to pause operations reflects the challenging macroeconomic conditions and the prolonged crypto winter that has lasted nearly a year. During this period, numerous crypto companies have faced downsizing, cost-cutting, or bankruptcy due to reduced customer demand and volatile market conditions.

Workforce Reductions

Blockchain.com has been significantly affected, reducing its workforce by about 28% or approximately 110 employees earlier this year. This followed a previous layoff of 150 staff members after the collapse of the crypto hedge fund Three Arrows Capital, a former client.

Valuation Decline

The company's valuation has seen a substantial decline. An effort to raise new funding in October reportedly valued Blockchain.com between $3 billion and $4 billion, a stark contrast to its previous $14 billion valuation.

The suspension of BCAM underscores the broader challenges faced by the crypto industry amid fluctuating valuations and market instability.