The cryptocurrency market has recently heated up with its down to its low of nearly $USD18,500. According to data from CoinGecko, up until October 2022, the Bitcoin value has been down by more than 50%, meanwhile the Ethereum has lost almost 65% from its euphoria-driven value around this time last year.
Yes, cryptocurrency prices are continuing to fall. And that’s not all. The CEOs of the cryptocurrency companies have also decided to leave and resign. The CEOs made the decision resigning from crypto companies for very different reasons. Their actions can be one indicator of the pivotal moment in the crypto industry. And as a hodler, should this be your signal too, should you be worrying and what to do next?
What are the reasons CEOs are resigning from crypto companies?
1. Sam Trabucco, Former CEO of Alameda Research
Sam Trabucco, a co-CEO of Alameda Research, the crypto hedge fund founded by FTX CEO Sam Bankman-Fried, announced his resignation last August. He cited that the reason for his resignation is a decision of himself to “prioritize other things” and his inability to “continue to justify the time investment”.
Trabucco stated that he has reached a moment in life where other things, such as boats, are more important than business.
Sam Trabucco joined Alameda in 2019 and was later named as the company’s co-CEOs in 2021 together with Caroline Ellison. Caroline will serve as the company’s sole CEO after the leaving of Sam.
2. Jesse Powell, Former CEO & Co-Founder of Kraken Crypto Exchange
The Wall Street Journal was the first which reported the news on Jesse Powell plan on resigning his position of the co-founder and CEO of Kraken, one of the popular crypto exchanges after Coinbase.
Founded by Powell himself and Thanh Luu in 2011, Kraken has been the first Bitcoin exchange to be listed in Bloomberg terminal. At its value of $USD 10.8 billion, Powell decided to leave Kraken at the end of September 2022.
Powell reportedly stated that the expansion of Kraken was the reason for his decision to back off, saying, “It’s just gotten to be more exhausting on me, less fun.” He continued by saying that he still intended “to stay very engaged with the company.”
The leaving of Powell being replaced by the current Chief Operating Officer of Kraken, Dave Ripley.
While doing what he enjoys, Powell intends to continue his involvement with Kraken. He will continue in the product development and advocacy for the cryptocurrency sector while serving as chairman of Kraken’s board.
3. Brett Harrison, President of FTX US
Another giant crypto exchange CEO making his moves out from the crypto industry is Brett
Harrison. On 27th September, Harrison announced on Twitter about his leaving from his current position as the President of the FTX US.
Harrison didn’t reveal his real plan and the reason why he decided to leave, but stated that he will continue to work with the exchange “with the goal of removing technological barriers to full participation in and maturation of global crypto markets, both centralized and decentralized.” Harrison began serving as the president of FTX US in May 2021, after working for Citadel Securities.
4. Michael Saylor, Former CEO of MicroStrategy
Year 2022 is not a good year for crypto and August saw another CEO of a crypto company resigning, Michael Saylor.
Known as the Bitcoin maximalist, Saylor, the CEO of MicroStrategy, handed out his position to his deputy, Phong Le. Following the huge losses in Bitcoin after the second quarter earnings call of MicroStrategy, Saylor decided to let go his position in MicroStrategy and moved to another entity for an executive chairman position.
5. Michael Moro, Former CEO & Matthew Ballensweig, MD of cryptocurrency broker Genesis
The exodus of CEO resigning also affected Genesis, the crypto lender. Michael Moro handed-over his CEO position last August as well as Matthew Ballensweig, its MD left in September.
Genesis has been impacted from the downfall of the Three Arrows Capital (3AC) which the now-liquidated Singaporean cryptocurrency hedge fund in July. Ballensweig claims that he will “definitely” remain in the cryptocurrency industry despite the difficult circumstances.
Both the resignation of Genesis’ Moro and Ballensweig are the outcome of choices made in the past, during the height of the crypto bull market enthusiasm.
6. Alex Mashinsky, Former CEO of Celsius Crypto Lender ; Do Kwon, Former CEO of Terra ; Su Zhu & Kyle Davies, Co-Founder of Three Arrows Capital (3AC)
These three musketeers crypto companies are the one who dragged most of the crypto reputation down. Not blaming the whole to the market, Celsius was one of many businesses that struggled as a result of Terra’s $40 billion failure and the subsequent market downturn.
The same goes to 3AC, up until now, $1 billion is still owed by 3AC to its creditors and investors.
Is it a sign of a larger trend?
The overall macroeconomic market conditions set the larger trend. As was already reported, the two most popular cryptocurrencies, Bitcoin and Ethereum, are already down more than 50% from their high point as from previous year’s bull run. The Federal Reserve’s decision to raise interest rates, the inflation rate’s continued rise, and the US’s negative GDP all may be contributing factors to the market volatility that is causing this.
What does this mean for the future of crypto?
Despite a decline in value and consumer interest in cryptocurrencies the year of 2022, some might see this as a blessing in disguise. The White House in the US is starting to release their first regulatory framework of crypto.
While some may view this as a time to be afraid of cryptocurrencies, it may actually be a good opportunity to stockpile them and profit from the next rally.
As a hodler, should you be worried? What can you do to stay safe?
As the market volatility appears to have eliminated the sector’s most careless and greedy players, it also allows you, as the hodler to realign your investment position sizing for the upcoming wave. There are some articles highlighting the next wave could be driven by significant financial institutions.
You can reduce position for now or add more, if you have more. According to NextAdvisor, experts advise limiting your bitcoin holdings to less than 5% of your whole portfolio. Bill Noble, chief technical analyst at Token Metrics, a cryptocurrency analytics company, advises you not to worry about the fluctuations because they will continue to occur.
Humphrey Yang, the personal finance expert behind Humphrey Talks, advises following the works of all long-term investments: set it and forget. As long as your crypto investments don’t get in the way of your other financial goals and you’ve only invested what you’re fine with losing.
Conclusion
Cryptocurrency remains the new kid on the block. The market has been in flux in these two years. But it’s difficult to predict whether or not crypto will die this year. Additionally, the 2009-founded cryptocurrency business has since expanded, with rising institutional use and increased regulatory focus.
The CEOs that resigning from crypto companies can be the sign of crypto transition. But this also indicates a more matured and professionalism practice in its leadership and principles.
Again, the new all-time highs for cryptocurrency are still far away. However, the room will be ready when the time comes. Keep yourself up-to-date with the latest news of crypto, like following Elon Musk‘s Twitter. Or even can look out for stock market headlines, be sure you wouldn’t miss anything.
