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The Securities and Exchange Commission saw its highest attrition rate in a decade this year, according to an annual report from the inspector general’s office.

The commission’s attrition rate jumped to 6.4% in fiscal year 2022, up from 3.8% in fiscal year 2020, according to the report. The attrition rate for senior officers was even higher — 20.8% this year — which the report deemed “most concerning.” The attrition rate for attorney positions was also relatively high at 8.4%. The numbers for fiscal year 2022 cover up to Sept. 20 of this calendar year. The federal fiscal year runs from Oct. 1 to Sept. 30. 

“The SEC is not alone in facing a crisis to retain mission-critical talent during what has been dubbed ‘The Great Resignation,’” wrote Acting SEC Inspector General Nicholas Padilla, Jr. “Critical elements of the federal workforce are in a state of stress.” 

Warnings about the SEC’s turnover come as part of a regular annual report from the internal watchdog on the agency’s operations. The 27-page document also addresses meeting regulatory oversight responsibilities, protecting systems and data and improving contract management. 

“The federal government is facing stiff competition from the private sector as increased wages and workforce engagement make private sector positions attractive to both new and seasoned professionals,” the report said. 

The commission is not alone when it comes to staff retention, the report notes. Government-wide attrition rates are also on the rise. The average attrition rate was 6.1%, though that number is higher for women and executives. The staff moves also come amid a change in presidential administrations last year. 

Even as turnover increases, the SEC requested 454 new positions for fiscal year 2023, bringing its total to 5,261 staff members. The agency lost approximately 289 positions in fiscal year 2022, which could pose a challenge in filling its roles for next year, according to the inspector general.

The commission could address its attrition issues by planning for succession, through employee development and via performance management, the report suggested. The SEC could also streamline its hiring process — nearly 50% of the commission’s hiring actions took 100 business days or more to complete.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Do Kwon is the most wanted man in crypto, with South Korean authorities, Interpol and now UST Restitution Group trying to track him down. 

The group of nearly 4,400 former Terraform Labs investors has coalesced in an effort to locate the man behind the failed firm, the Financial Times reported.

Many in the group that the paper spoke with said they lost their life savings when Terra collapsed. Now they spend their time scouring the internet for clues on the founders whereabouts and sharing their findings in a Discord group. 

A South Korean court issued a warrant for Do Kwon’s arrest last month and Interpol later issued a red notice for his arrest.

The tech entrepreneur claimed on Twitter that he’s “not on the run” and “making zero effort to hide.”

“Any government agency that has shown interest to communicate, we are in full cooperation and we don’t have anything to hide,” he said.

Members of the UST Restitution Group have indicated that Kwon could be in Dubai – with one even flying to Dubai to try to track him down. Other possible locations include Russia, Azerbaijan and the Seychelles.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

The Terra Classic blockchain contributors have reduced the so-called burn tax levied on all Terra Classic token (LUNC) transactions.

The contributors adjusted the tax rate from 1.2% down to 0.2%, due to the former rate being considered to prompt a drop in network activity.  

The updated rates came into force at 8:50 am ET today after the community ratified the governance “Proposal 5234,” and decreased the number of tokens burned with each transaction.

After UST stablecoin’s depeg that wiped over $40 billion in value in May 2022, Terra’s creator Do Kwon abandoned the original Terra network and relegated the project to “classic” status in favor of the new Terra 2.0 chain. The project is now run by community members and investors who took control of the project’s development. 

Last month, the Terra Classic governance body passed a vote to apply a 1.2% tax on each LUNC transaction and destroy the amount in an effort to bring down LUNC’s supply, believing fewer tokens in circulation would lead to an increase in value. 

It’s worth noting that in the aftermath of Terra Classic’s May collapse, the blockchain was left with 6 trillion LUNC tokens in circulation from UST redemptions, which is 20,000 times more than Terra’s supply of $300 million prior to its collapse. 

While the 1.2% burn tax hoped to improve LUNC’s tokenomics, it disincentivized usage and ended up shrinking on-chain activity. The tax drove down the on-chain transaction volume for LUNC by 91.67%, according to estimates from core contributors.

A new community proposal floated on Oct. 10 suggested retaining the tax but lowering the rate hoping to find the right balance between activity and the option of gradually reducing token supply. The proposal passed today with 83% of votes in support of it. Besides reducing the burn rate, the proposal also sets aside 10% of tax revenue to fund ecosystem activities and pay for contributors. 

The price of Terra Classic (LUNA) is down 2% on the day and is currently changing hands at $0.00024 with a market capitalization of $1.7 billion, according to CoinGecko.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

After the Terra-Luna collapse sent crypto prices tumbling in May, many firms trimmed substantial parts of their workforce to stabilize their businesses.  

In June, for example, Coinbase laid off around 1,100 employees, BlockFi cut roughly 20% of its workforce, or about 170 people, and Crypto.com let go of over 260 people. The Verge later reported that this number was closer to 2,000. 

Since then, many crypto firms have focused on preparing their operations to withstand a crypto winter. Like FTX, Kraken and Nexo, some have continued to hire, albeit less dramatically. 

But with no signs that the market will rise any time soon, another round of corporate reshuffling has begun, including for those at the very top. MicroStrategy chief Michael Saylor, Kraken’s Jesse Powell, Genesis head Michael Moro, Sam Trabucco of Alameda Research, FTX president Brett Harrison and Celsius CEO Alex Mashinsky are all among the high-profile crypto leaders that have left top roles in crypto in the last few months. 

With a fresh round of job cuts underway, here is a roundup of all the job losses that have happened in crypto since April. 

Fintech and crypto firms making job cuts

April 

• Crypto derivatives trading platform BitMEX announced layoffs for 75 employees. The move was made after the collapse of a bank acquisition deal. 
• Robinhood cut about 9% of its staff, out of 3,800 employees reported on December 31, 2021. The news came days before the firm released its first quarter earnings report, plunging the company’s share value by over 5% during extended trading. 

May  

• Latin American crypto exchange Bitso laid off around 80 employees. Amid the cuts, the company was still listing more than 60 open positions on its jobs pages, Coindesk reported. 

• Buenbit, an Argentina-based crypto exchange, cut the jobs of 45% of its staff — or about 80 workers. CEO Federico Ogue denied that it was linked to the recent crash of UST and Luna, and tied it to a “global overhaul” of the tech industry. 
• Buy now, pay later giant Klarna announced its first round of layoffs – roughly 10% of the company’s workforce, or 700 people globally. The cut followed a report from Bloomberg stating that the company’s borrowing costs had hit record levels and its valuation would plunge in its upcoming funding round. 

June 

• CEO Kris Maszalek announced that Crypto.com would lay off 260 employees, or roughly 5% of its workforce. But according to a new report from Ad Age, the exchange massively understated those layoffs, and has quietly dismissed over 2,000 employees. The company has recently said that the Ad Age report was “inaccurate.” 
• Coinbase slashed its workforce by about 18% or approximately 1,100 employees. The decision to make layoffs was, according to CEO Brain Armstrong, to “ensure we stay healthy during this economic downturn.” He also acknowledged that the company had grown too quickly and had “overhired.”   

• Crypto exchange Gemini trimmed about 10% of its workforce, or around 100 employees in June. The company cited “current macroeconomic and geopolitical turmoil” as the reason behind the layoffs. 
• BlockFi, a crypto lending and financial services platform, fired roughly 20% of its workers, affecting more than 150 people. Co-founders Zac Prince and Flori Marquez cited “current market conditions that have had a negative impact on our growth rate and a rigorous review of our strategic positions.” 
• Abra, a California-based crypto trading and lending platform, cut 12 jobs, or around 5% of the company’s total workforce in June. The measure was taken “purely as a cost-saving measure,” said CEO Bill Barhydt. 
• On the same day Abra announced layoffs, Hong Kong-based licensed crypto exchange OSL said it had cut between 40 and 60 jobs, or about 15% of its workforce. A company spokesperson asserted that the job cuts were not caused by OSL’s exposure to any troubled crypto firms or tokens, including staked ether (stETH) and TerraUSD (UST). 
• 2TM, the holding company for Mercado Bitcoin, laid off more than 80 employees. The company cited “the changing global financial landscape, rising interest rates and inflation.” Mercado Bitcoin is Brazil’s biggest crypto exchange. 

• Bybit, the world’s second-largest crypto futures exchange, laid off some of its workers, but did not disclose the number of jobs lost. The firm offered those affected a severance package and access to the company’s employee career support in their job transition. 
• Australian crypto payment firm Banxa announced that 30% of its staff would lose their jobs, cutting the total from 230 down to 160. The company also paused all expansion efforts in Europe and said it would focus on its operations in Australia and the Philippines. 

July 

• Austrian investing platform Bitpanda cut the jobs of around 270 employees and cancelled existing offers of employment. This move happened only three weeks after the company executives announced to employees in internal Slack channels: “There will not be any kind of massive layoffs.” 
• Crypto exchange Gemini laid off additional staff after its initial round of layoffs in June, according to a report from TechCrunch. “The company had not widely communicated the extent of Monday’s layoffs internally, leaving employees to speculate on the exact number of co-workers laid off in this most recent downsizing,” the publication said. “A source close to the company noted that there was a reduction of 7%, or 68 members, in Gemini’s companywide Slack channel Monday morning.” 

• Bullish, a crypto exchange serving institutional clients, let up to 30 employees go, out of a total staff of about 390. The company said it “continues to actively hire for product, engineering and other strategic roles.” 
• Game developer Immutable cut 8% of its workforce, or more than 20 members of staff. The cuts were part of a reorganization effort that focused on Gods Unchained, Immutable Games’ flagship strategy non-fungible token (NFT) card game, and other job losses were concentrated in Immutable’s talent acquisition team. 
• NFT marketplace OpenSea revealed that roughly 20% of its staff would be let go in an effort to elongate its runway. While the exact number of employees impacted wasn’t disclosed, OpenSea told The Block that 230 employees remain at the company. 

August 

• Robinhood announced that it would lay off approximately 23% of its staff, or roughly 780 people. The cuts were announced along with the company’s second quarter earnings, where it reported a $295 million net loss. Just three months earlier, Robinhood announced job cuts for 9% of its staff.  

September  

• 2TM, the parent company of Brazilian cryptocurrency exchange Mercado Bitcoin, laid off about 15% of its staff, or roughly 100 employees. It’s the latest round of layoffs among Latin America-based crypto companies in recent months, following another round of job cuts in June.  

• The Block reported that social media giant Snap was cutting its web3 team in an attempt to cut costs. Jake Sheinman, co-founder of Snap’s web3 team, revealed the company’s plans in a tweet that announced his departure. “As a result of the company restructure, decisions were made to sunset our [w]eb3 team,” he wrote. 

October 

• Crypto market-maker GSR announced that it laid off just under 10% of its staff to “position the business for long-term growth,” a GSR spokesperson told The Block. The company cut roles for roughly 30 people, bringing the company’s headcount to 300. 
• China Morning Post and Wu Blockchain reported that move-to-earn fitness app Stepn had laid off over 100 contract workers, including community moderators and ambassadors. A company spokesperson told news outlet Decrypt, however, that the claims were factually inaccurate. STEPN parted ways with inactive MODs, a spokesperson said, and, in fact, is actively hiring for several roles within the company. 
• Coindesk reported that India-based crypto exchange WazirX laid off 50 to 70 people, or approximately 40% of its total workforce. Dismissed employees will receive pay for 45 days, the report said, and will not be required to report for work during that time. 

• Checkout.com, a digital payments platform, has announced that it will dismiss 5% of its workforce, or approximately 100 people. The cuts were first reported by Bloomberg, and reissued in a company statement. 
• Buy-now-pay-later fintech pioneer Klarna announced a new round of job cuts, only weeks after its CEO claimed that job losses were over at the firm. The latest round of job losses is set to impact around 100 employees globally, a spokesperson told The Block. In May, the firm laid off around 700 staff.  

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

A senior advisor to the Bank of England suggested that decentralized finance is not as decentralized as it claims to be in a speech to the University College London’s Blockchain Research Center on Wednesday.

“Concentrations of power in [proof-of-work] and [proof-of-stake] systems, and other flaws in governance of crypto and DeFi, have already contributed to all–too familiar issues; top of the list are business failures, illegal activity and financial losses for investors,” warned Carolyn Wilkins, an external member of the central bank’s financial policy committee and a former leader for Canada’s central bank. “If left unchecked, this state of affairs will erode trust among investors in crypto–based financial services and their customers, and could lead to financial stress more broadly.”

Wilkins cited a study from April 2022 that showed that in a sample of the 50 largest by market capitalization proof-of-stake platforms, the top ten validators held between 47% and 100% of the stakes.

The central bank advisor noted that regulation and legislation in digital assets remain a work in progress, but called on the private sector and DeFi investors to do more in ensuring the safety and proper governance of projects and digital assets. 

“It is in the interest of the private sector to be proactive,” Wilkins said. “Major investors must ‘get up, stand up’ to demand change. It is critical that industry adopt best practices and codes of conduct to reinforce trustworthy behaviour and culture.”

When it comes to proof-of-work blockchains, Wilkins warned that crypto miners can take advantage of their position by making decisions on how to execute transactions, or manipulate the market in what is known as maximal extractable value. She also noted that open source DeFi platforms like Polkadot and MakerDAO have emergency powers for leadership teams to unilaterally make decisions. 

Wilkins also noted that the incumbent financial sector has begun adopting blockchains, lending added urgency to the need for improvements from digital asset projects. 

“The window for the crypto industry to improve its approach to governance is narrowing,” Wilkins said. “Regulated firms in traditional finance are increasingly applying the underlying blockchain technology to traditional capital markets. They will be in a better position to capture this market if the crypto industry does not get its house in order, if only because they have more familiar and battle-tested governance.”

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Nubank, the leading Brazilian digital bank by market value, has announced that it will launch an in-house loyalty token in the first half of 2023.

The bank plans to release the token, dubbed Nucoin, as part of a broader loyalty program that offers users benefits and discounts.

Nucoin will be built on the Polygon, according to Nubank, which selected 2,000 customers who will be the first to test out the token.

Nubank launched its crypto trading services in May, and by the end of September, it recorded nearly 2 million crypto users on its platform.

“We want to further democratize new technologies such as blockchain and web3, and go beyond Nubank Crypto, the function to buy and sell cryptocurrencies in the app,” Nubank said. 

This move also follows the fact that Latin American e-commerce giant Mercado Libre launched its own token, Mercado Coin, in August.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Celestia Labs, a startup that hopes to build better blockchain infrastructure with a modular approach, has announced $55 million in fundraising.

Bain Capital Crypto, the $560 million fund launched in March, and Polychain led the fundraising, according to a statement today. Placeholder, Galaxy Digital, Delphi Digital, Blockchain Capital, NFX, Protocol Labs, Figment, Maven 11, Spartan Group, FTX Ventures, Jump Crypto also participated — along with angel investors including Balaji Srinivasan, Eric Wall and Jutta Steiner.

The cash came through two quietly conducted rounds — a Series A and B — that closed earlier this year, according to a person familiar with the deals. The more-recent capital injection valued Celestia at $1 billion, granting it unicorn status, the person said.

Celestia has built a “modular blockchain architecture” to compete with established players such as Ethereum, which it describes as “monolithic” in design. Celestia’s trick is to separate the consensus mechanism — which is how blockchain participants agree that transactions have taken place — from execution.

The idea, as laid out in its announcement, is that any developer will be able to use Celestia’s technology to roll out a decentralized blockchain without having to concern themselves with setting up a consensus network from scratch.

“For the past decade, crypto has been bottlenecked by an endless loop of new monolithic L1 smart contract platforms, each racing to the bottom to sacrifice decentralization and security to provide cheaper transaction fees,” said Mustafa Al-Bassam, co-founder at Celestia Labs, in the statement. “We envision a blockchain ecosystem with modular data availability layers and execution engines that all integrate together.”

A modular movement

In September, Fuel Labs announced an $80 million raise for its modular execution layer — a round led by Blockchain Capital and Stratos Technologies. The startup effectively focuses on the flip side of the coin to Celestia, and the pair have close ties. Ekram Ahmed, head of communications at Celestia, is a strategic advisor to Fuel.  

Celestia last announced a fundraise in March 2021, when it secured $1.5 million in seed capital from backers including Binance Labs, Maven 11 and KR1. The company launched its testnet, named Mamaki, in May of this year.

It named Eclipse, Constellation and dYmension as examples of projects that are currently using Celestia as their data availability layer. Alex Evans, a partner at Bain Capital Crypto, said in a statement that modular blockchains are “unlocking rapid experimentation” and called the pace of development in the Celestia community “breathtaking.” 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Arcade2Earn, a play-to-earn gaming platform built on the Solana blockchain, has raised $3.2 million in a seed funding round led by Crypto.com Capital.

Other investors included Solana Ventures, Shima Capital, KuCoin Labs and GSR, Arcade announced. The funding was realized via a simple agreement for future tokens (SAFT), Arcade co-founder Jaleel Menifee told The Block. The company’s utility token is known as arcade.

Funding across web3 investments has tumbled this year, but gaming projects are still popular with the most venture funding going to NFTs and gaming in the third quarter, according to The Block Research. 

Arcade claims to differ from the plethora of web3 gaming platforms with its unique concept called “mission pools” that allow gamers to make money without owning NFTs.

Users can contribute to a specific mission pool using the xarcade token (the synthetic version of arcade), Menifee said, which is comprised of operators and contributors. Anyone approved by Arcade can be a mission pool operator, including a gaming guild. Operators will be able to play games using NFTs owned by Arcade’s treasury or lent to Arcade, which are then used to generate rewards.

Mission pool contributors, on the other hand, are arcade token holders who get to decide which operators and in-game activities they wish to support by depositing their xarcade tokens in a mission pool. The deposited xarcade token is locked in the mission pool and returned upon completion along with a proportionate share of the rewards.

“Not everyone is good at playing or has time to play games and earn,” Xinlu Yu, head of KuCoin Labs, said in a statement. “This is where Arcade fills the gap by enabling those groups of people to enjoy earning yields through their specific products without directly playing the games themselves.”

The Arcade platform is under development, with its demo scheduled to launch before the end of the year, Menifee said. The public launch of the platform and the token will follow.

There are currently 20 people working for Arcade, including its six co-founders. The firm isn’t looking to immediately add to its headcount.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Quick Take

• Signature Bank announced earnings on October 18, 2022 
• Closed today’s trading +2.8% in 1-day intra-day trading at $157.29 per share 
• Reported $358mm Net Income, a +48% / +117mm increase on Q3’21 Net Income of $241mm 
• Reported $492mm Pre-tax Pre-provision Earnings, a +49% / +$161mm increase on Q3’21 of $331mm
• Reported Q3’22 $5.57 EPS compared to Q3’21 $3.88 EPS
• Added ~1,000 new clients across the business in Q3’22
• Digital asset banking unit experienced a ($3.0bn) outflow in deposits

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Crypto exchange Binance has made a move toward taking part in the governance process of the decentralized exchange Uniswap, making it the second-largest entity by voting power in the Uniswap DAO.

Binance delegated 13.2 million UNI tokens on Oct. 18 to its own wallet, meaning the exchange is now able to use those tokens to vote on governance decisions affecting the protocol within the Uniswap DAO. 

Binance now has 5.9% of the voting power, calculated as a percentage of tokens delegated to the exchange out of all delegated tokens. It sits behind crypto VC firm a16z, which has 6.7% of the vote.

That’s causing some concern for Uniswap founder Hayden Adams, who is worried that Binance may use tokens that are owned by the exchange’s users to participate in governance for its own reasons.

This is a “very unique situation, as the UNI technically belongs to its users,” said Adams on Twitter. Normally more governance participation is good, he said, noting that it is unclear how Binance plans to engage with the governance system.

The amount Binance has delegated represents 1.3% of the total supply of UNI. This is above the 0.25% threshold for proposing governance votes but below the 4% quorum required for votes to pass. The threshold for proposing votes was recently reduced following a governance vote.

Binance wasn’t immediately available to comment.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.