Valkyrie Investments has laid off 30% of its staff in recent months and has closed a fund as the crypto ETF issuer tries to stay agile amid tough market conditions.
The cuts amount to six people in the firm’s sales and marketing division — the company now has 16 full-time employees, Valkyrie CEO Leah Wald told Blockworks.
The layoffs weren’t made all at once, she added, as the company started staff cuts in June.
“Like many other companies in our industry, cuts needed to be made and ours were limited to sales and marketing,” Wald told Blockworks in a message. “We have also taken a hard look at our product mix and will be launching a new product offering soon.”
Wald said the firm is focused on launching risk-managed products but declined to comment further. Valkyrie unveiled separately managed accounts (SMAs) last month for financial professionals looking to offer crypto exposure to clients.
The SMAs expanded a product suite that also includes two ETFs trading in the US — the Valkyrie Bitcoin Strategy ETF (BTF) and the Valkyrie Bitcoin Miners ETF (WGMI).
BTF was the second bitcoin futures ETF to launch in the US — a few days behind ProShares’ Bitcoin Strategy ETF (BITO) — in October 2021. The Valkyrie fund has about $18 million in assets under management, while BITO has nearly $600 million.
The firm closed its Balance Sheet Opportunities ETF (VBB) last month. The fund, which launched last December, invested in public companies with exposure to bitcoin.
Industry watchers have said the delisting of several crypto-related ETFs in Australia earlier this month could become a global trend as the so-called crypto winter trudges on.
“We are not considering closing any other ETFs at this time,” Wald said. “The Balance Sheet Opportunities ETF did not receive the traction Valkyrie had hoped for given the many competitor copycat funds that also entered the market.”
The fund closure and cuts have come during a bear market amplified recently by the collapse of crypto exchange FTX, which filed for bankruptcy last week. In its latest bankruptcy filing, published Monday, FTX lawyers said the bankruptcy estate may have as many as 1 million creditors.
Though various cryptoasset managers had direct exposure to FTX or its native token, FTT, Valkyrie said in a tweet on Nov. 11 that it did not engage with FTX or Alameda Research and that client assets were secure.
“The same controls that kept us from being exposed to this liquidity crunch also spared us from the fallout of Celsius, Voyager Digital or Three Arrows Capital,” the firm added.