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Over the past two months, several cryptocurrency executives have stepped down, indicating that this could be a turning point for the industry.
FTX.US President Brett Harrison and Celsius CEO Alex Mashinsky recently resigned after leaving the list of other top cryptocurrency executives. They follow Genesis CEO Michael Moreau, Microstrategy CEO Michael Saylor, Kraken CEO Jesse Powell, and Alameda Research co-CEO Sam Trabucco, who have all stepped down from their posts in recent months.
Crypto executives step down
Surprisingly, a surprising number of high-profile crypto executives have left their posts this year.
FTX.US President Brett Harrison joined a growing list of notable exits on Tuesday, announcing on Twitter that he will step down and move to a consultant position with the company in the coming months. Harrison, who has held the position for a year and a half, stated in his posts that the crypto industry is at a “crossroads” and that he will continue to work in the field of crypto to remove barriers to entry for new “big market entrants”.
Harrison’s announcement came just an hour after Celsius CEO Alex Mashinsky announced that he was also stepping down from his leadership role. However, Mashinsky’s motives were very different, as he decided to resign because his “permanent CEO role became increasingly distracting”. Celsius, which used to be one of the leading crypto lending companies, filed for bankruptcy after it ran into insolvency issues this summer; Customers have not yet received a refund.
Harrison and Mashinsky are retiring under very different circumstances: the first after FTX.US went from a team of three to a company with a hundred employees in seventeen months, and the second after overseeing a $1.19 billion hole in its firm’s balance sheet. However, their departure is indicative of an ongoing shift in the crypto industry.
Cryptozyme
With Bitcoin and Ethereum down over 70% from their all-time highs, the total cryptocurrency market cap is now below $1 trillion, down from $3 trillion in November 2021. Market volatility has wiped out many prominent industry figures, including wanted Terra co-founder Do Kwon and infamous Three Arrows Capital duo Su Zhu and Kyle Davis.
Celsius was one of several firms that ran into trouble as a result of Terra’s $40 billion collapse and the ensuing market downturn. The departure of Mashinsky in this sense is a consequence of this situation. The same thing happened to Michael Moreau, who stepped down as CEO of Genesis in August when his firm was hit by a $2.4 billion loan to Three Arrows (Celsius also had access to a hedge fund).
Microstrategy co-founder Michael Saylor’s recent position change from CEO to Executive Chairman can also be seen in this light. Sailor was Bitcoin’s most vocal supporter during the recent bull run, which he may still be today. However, Microstrategy has now lost $1.5 billion due to its position in Bitcoin, having invested in the top cryptocurrency at an average price of $30,639 per coin (Bitcoin is currently trading in the $20,000 range).
Key moment
While retail interest in crypto has fallen this year, digital assets are getting more political attention than ever before. On Sept. 16, the White House released its first comprehensive regulatory framework for cryptocurrencies, urging the Treasury Department, Justice Department and other agencies to continue to monitor the space. The Securities and Exchange Commission and the Commodity Futures Trading Commission have begun to take a much more “hands-on” approach to regulation, and lawmakers are actively debating crypto policy in Congress.
Recent events show that the cryptocurrency is emerging from regulatory uncertainty. While this could attract the “big market players” that Harrison mentioned in his retirement announcement, it does indicate a shift in the crypto landscape. In this context, the resignation of Jesse Powell makes sense. Powell, one of the most outspoken libertarians in the crypto space, founded Kraken in 2011 when the cryptocurrency was still very niche.
Last year, Powell criticized sanctions against Tornado Cash, as well as an attempt by Prime Minister Trudeau’s government to seize the cryptocurrency funds of protesters in Canada. He also refused to block crypto addresses belonging to Russian accounts, unless required by law. Powell may be reversing his position because he believes crypto is becoming more regulated, more interoperable, and less sovereign.
“For me, that means spending more time on things I’m good at and enjoy, like working on a product and advocating for the industry,” he recently told Fortune magazine.
What lies ahead?
In cryptocurrency, time moves at a different speed. Because the space is evolving incredibly fast, it can usually feel overwhelming – even for veterans. So it was understandable when Alameda Research co-CEO Sam Trabucco announced he was stepping down last month because he wanted to travel, spend time with family and friends, and enjoy his new boat. During the bull market, Trabucco became famous for posting threads detailing how and why Alameda triggered liquidation cascades after they happened. Now he has started posting pictures of turquoise waters and boat-related gifs.
Not every crypto executive can enjoy such a happy ending, but the recent shuffling of industry leaders signals that something is happening in this area. Market turmoil seems to have rid the industry of the most reckless actors; it also allowed some of them to change their position for the next wave of adoption, which could be led by large financial institutions. Cryptocurrency is still far from new all-time highs. But when the time comes, the space will be ready for it.
Author: Anton Zaitsev, analyst Freedman Сlub Crypto News
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