Weeks Before Replacing its Top Executives, NYDIG Dismissed 30% of its Workforce (Report)

New York Digital Investment Group (NYDIG) – an investment management firm that offers a wide variety of bitcoin services – reportedly laid off around one-third of its staff in September.

Not long ago, it announced the departure of CEO Robert Gutmann and President Yan Zhao. Despite the redundancies, the former leaders remained as key members of NYDIG’s parent company – Stone Ridge Holdings Group.

Joining the Dismissal Spree

The Wall Street Journal informed that last month NYDIG let go 110 people, or 30% of its total workforce, as a cost-cutting measure during the ongoing bear market. Specifically, the firm told the affected employees that it is “seeking to trim expenses and narrow its focus to more-promising businesses.”

Earlier this month, NYDIG revealed that CEO Robert Gutmann and President Yan Zhao stepped down from their positions. Without giving a specific reason, the firm announced their roles will be taken by Tejas Shah and Nate Conrad, respectively.

The aforementioned amendments came as a surprise since the cryptocurrency-focused entity disclosed its bitcoin balances hit an all-time high during Q3, up almost 100% YOY. In addition, its revenue was up by 130% in the second quarter of 2022, followed by another increase in Q3.

A few weeks ago, the company raised $720 million for its institutional Bitcoin fund. Nonetheless, the US SEC is about to review the initiative, meaning it is not yet completed.

Ross Stevens – Founder and Executive Chairman of NYDIG – said the firm’s balance sheet is “the strongest it’s ever been.” He claimed, though, that the changes in its structure are necessary when “markets crumble.”

Who Else Laid Off Staff?

In 2021, prompted by the crypto bull run, many companies in the sector expanded their operations and hired more employees to cope with the growing demand for digital asset products and services. However, this year’s negative trends changed the tides completely.

Some of the leading exchanges like CryptoCom, Gemini, Bybit, Coinbase, Huobi, and more are among the examples.

The largest NFT marketplace – OpenSea – also had to take that step due to the diminishing interest in its niche. In July, it laid off approximately 20% of its staff.

Still, a few companies, including Binance, think the plunge of the crypto market should not be a reason to fire employees. Several months ago, CEO Changpeng Zhao argued it could be a great period to hire people.

“We have a very healthy war chest, we, in fact, are expanding hiring right now,” he announced back then.