It appears that the crackdown on crypto companies by the US Securities and Exchange Commission (SEC) has severely affected the business of Binance. In recent weeks, the crypto exchange reportedly laid off more than 1,000 employees and cut several benefits.
According to Binance, the decline in earnings was due to “the current market environment and regulatory environment,” which suggests further cuts may be in the works. A spokesperson told Cointelegraph that the company will consider reducing “certain products, business units, employee benefits and policies” in response to business and regulatory concerns.
Binance has so far faced 13 charges filed against it by courts and the SEC, as well as the results of a US Department of Justice investigation targeting its activities and executives.
Despite the gloomy outlook ahead, Binance is still the most popular centralized crypto exchange in the world, with over $63 billion in assets. A token breakdown by DiFillama shows that the majority of assets on Binance are comprised of Tether (USDT) (27.55%), Bitcoin (BTC) (26.95%), BNB (BNB) (12.82%) and Packaged Ether (10.08%).
Commenting on Binance’s July 14 birthday, Changpeng Zhao, CEO of the exchange, recalled that the company’s journey has “never been smooth”.
This week in the crypto biz, Binance’s continued efforts to stem declining profits, Ripple’s expectation that US banks will soon adopt XRP (XRP), and the first signs of venture capital returning to crypto.
Ripple CLO Says Court Ruling May Encourage Banks to Use XRP
Ripple Labs Chief Legal Officer Stu Alderotti believes that US-based banks may turn to XRP for cross-border transactions following the recent court ruling. “Hopefully there will be a lot of conversations with customers in the United States this quarter, and hopefully some of those conversations will actually lead to real business,” he said during an interview. As the “security” label seemingly no longer hangs over XRP, the partnership between Ripple and banks that was muted by the SEC lawsuit could find new life. Bank of America was eyeing a blockchain company in 2019, and American Express first partnered with Ripple in 2017.
#New: Presidents @PatrickMcHenry And @congressmangt Issuing a Statement Regarding the Court’s Decision in SEC Vs. Regulatory clarity is needed in the digital asset ecosystem to avoid further uncertainty for Ripple and our financial markets.
Read more https://t.co/y1nITVmHvh pic.twitter.com/tn0dn0BDHd
– Financial Services GOP (@FinancialCmte) 14 July 2023
Binance Cuts Employee Benefits Citing ‘Drop Profits’
Global cryptocurrency exchange Binance is cutting some employee benefits as a result of reorientation efforts at the company. The company has reportedly stopped providing benefits to employees for certain expenses, including cell phone use, fitness and working from home. Binance cited the “current market and regulatory environment” for the decline in earnings, suggesting that more cost-cutting measures may be needed. The report follows massive layoffs in June that affected more than 1,000 employees. Both Binance and Zhao have been targeted by SEC lawsuits for allegedly offering unregistered securities in the United States.
Marathon shareholders filed a lawsuit against the company’s top management
Crypto mining company Marathon Digital is going to court over allegations that CEO Fred Thiel, along with other top executives, violated fiduciary duties, unjustly enriched himself and squandered company resources. According to the complaint, the company’s management downplayed its problems, artificially inflated Marathon’s valuation, received excessive compensation, made lucrative insider sales, and unfairly received large bonuses based on false and misleading statements.
Polychain Capital, Coinfund raise $350 million for new crypto fund
Web3 Ventures is gearing up for new investments in crypto projects as Polychain Capital raised $200 million for a new investment fund and Coinfund secured $152 million for a seed fund. Polychain is still planning to raise a total of $400 million for the new fund. It currently manages three funds with approximately $2.6 billion in assets under management. As for Coinfund, its CEO Jake Brookman said the company had aimed to raise $125 million, but managed to raise another $27 million due to renewed interest in the industry. The total amount of venture capital raised for crypto startups is down 76% over the past year due to the bear market and industry turbulence.
July marks Coinfund’s 8th anniversary and celebrates its journey @jbrukh @flexthought And the team from kitchen table to dressing table. We are excited to solidify this milestone with the announcement that Coinfund has closed its $158M Seed IV fund to support new internet leaders.
— Coinfund (@coinfund_io) 18 July 2023
Before You Go: Bitcoin Rally Will Lead to “Speculative Blow-Off Top” in 2024, Predicts Mark Yusko
BlackRock’s application for a spot bitcoin exchange-traded fund has ushered in a new crypto bull market, which will turn parabolic at some point closer to the planned halving for April 2024, according to Mark Yusko, chief investment officer and founder of Morgan Creek Capital.
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