Celsius Network CEO Alex Mashinsky resigned on September 27 along with Brett Harrison, the US president of FTX, among a series of other resignations from cryptocurrency exchanges and lenders in recent weeks as valuations plummeted.
Mashinsky was the latest CEO or senior executive to step down, citing that he had become a “distraction” for the company he founded that was previously valued at $3 billion as it is now undergoing bankruptcy proceedings.
He wrote in his resignation: “Effective immediately, please accept my resignation as CEO of Celsius Network Ltd, as well as my membership of the Board of Directors and other positions in both direct and indirect subsidiaries, except for my director position in Celsius Network Ltd.” message. “I regret that my continued role as CEO has become an increasing distraction, and I am deeply sorry for the difficult financial conditions that members of our community face.”
Celsius’ board of directors also appointed Chris Ferraro as interim CEO and head of restructuring. Previously he was Celsius CFO and spent nearly 20 years at JPMorgan Chase in various roles, most recently managing director of financial planning and analysis.
Once the crypto market crashed in June, Celsius banned clients from making withdrawals and filed for bankruptcy the following month.
Celsius emerged as a major cryptocurrency lender after offering up to 30% weekly returns, an astronomical amount when many traditional banks were offering 0.5% or less interest on savings.
The company sought to be an intermediary between traditional finance and the cryptocurrency space and was founded in 2017 by Mashinsky.
Celsius said in June that it owes its customers about $4.7 billion in crypto. The bank said it has 1.7 million customers, including 300,000 with accounts worth more than $100, according to bankruptcy filings.
The company is working with the US Trustee and the Unsecured Creditors Committee as part of its bankruptcy reorganization.
Brett Harrison, president of cryptocurrency exchange FTX US, also resigned on Tuesday, noting in a tweet that he will spend the next few months transitioning his responsibilities to a consulting position with the company. Harrison has already changed his job title to FTX Consultant on Twitter, a social media platform.
Harrison is among at least five CEOs or CEOs who have recently resigned from crypto companies in the wake of the valuation of digital currencies.
The cryptocurrency market is now only worth $971 billion as of September 27, having lost more than $2.29 trillion compared to its record of $3 trillion in November, according to data firm CoinGecko. Both lenders such as Celsius Network and Voyager Digital have filed for Chapter 11 bankruptcy.
He did not reveal the reason for his resignation, but said he plans to remain in the industry. Harrison said in a tweet that the cryptocurrency industry faces several crossroads, including “the intersection of access to larger market participants, increased fragmentation, and the technological complexity of the market landscape.”
Many leave the CEO
The chief executives of Kraken, Alameda and Microstrategy have also resigned over the past two months.
Jesse Powell, co-founder of crypto exchange Kraken, resigned in September. He will become president and be succeeded by an insider, Dave Ripley, who is currently COO.
Billionaire Michael Saylor, one of the most prominent Bitcoin advocates, has resigned as CEO of software company MicroStrategy (MSTR) In early August he will serve as president. He co-founded the company in 1989 and plans to focus on bitcoin, whose lower price prompted MicroStrategy to post a $2 billion drop fee in the second quarter.
Michael Morrow, who was the CEO of crypto brokerage Genesis, resigned in August, and Alameda Research co-CEO Sam Trabuco also resigned last month.