New manifestations of the rigors of the crypto winter: ETFs delisted and more layoffs

New manifestations of the rigors of the crypto winter: ETFs delisted and more layoffs

The crypto winter continues with its cohort of bad news that never ceases to chant a year 2022 two months from its end. Whether it’s products or staff, the major trend is rather to cut or reduce to save furniture or stop the damage.

Bad timing for Australian crypto ETFs

Three crypto ETFs will soon no longer be part of the Australian stock market landscape. Indeed, the companies issuing theETF Cosmos Purpose Ethereum Accessof Cosmos Purpose Bitcoin Access ETF and of Cosmos Global Digital Miners Access ETF have applied to revoke their listings on Cboe Australia. A decision that would be directly linked to the prolonged cooling of the crypto market, and not to a loss of belief in the future of Bitcoin and its offshoots.

Although we strongly believe in the asset class, we are all disappointed with this outcome, however, we will continue to follow the process in the best interests of all unitholders.

Dan Annan, CEO of Cosmos, quoted in Bloomberg

Introduced at the worst time of the market cycle, either last May and June, or in October 2021 for the mining ETF, local players were expecting inflows of up to $1 billion at the time, as clarified by The Block. Hopes quickly dashed the three Cosmos funds soon to be delisted each have a net asset value of less than US$700,000.

These radiations are not the first. Thus, in the United States, the Valkyrie Balance Sheet Opportunities ETFan investment product offering indirect exposure to BTC, was erased from the Nasdaq exchange on October 31 at the request of its issuer.

More generally, all institutional crypto products suffer from the rigors of winter, like the first Bitcoin ETF launched on the US marketwhich has lost much of its luster since its sparkling debut.

Ongoing workforce reductions

At the same time, the list of crypto companies that are still laying off or re-licensing keeps growing. Thus BitMEX, the crypto derivatives trading platform, which had already laid off 75 employees earlier in the year, is again reducing its workforce, 30% according to the first figure announced and then contested. This news comes after the announcement of the departure last week of CEO Alexander Hoeptner. An event which again is becoming common in the cryptosphere where number of high profile officials have recently left office.

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Willingly or by force, which could have been the case of Mike Novogratz, boss of Galaxy Digital, the institutional crypto services company. The company has yet to make an announcement, but is considering to a reduction in its workforce of the order from 15 to 20% of positions. In question of course the bear market, but above all Galaxy Digital’s overexposure to the Terra Luna ecosystem of which Novogratz was one of its major investors. Following its collapse in May, the company ended the 2nd quarter on record losses of $554 million. The 3rd quarter results published on November 9 will undoubtedly seal the fate of a certain number of employees.

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