Anchorage Digital cuts 17% of staff months after Tether valued it at $4.2 billion

Crowdfund Insider, which reported the cut on the word of people familiar with internal discussions ^[2], puts the starting headcount at roughly 400, the figure McCauley gave in congressional testimony last February ^[5]. Seventeen percent of that is about 68 jobs, leaving roughly 332 people ^[1][2]. Anchorage has not released an updated total or said which teams and offices are affected ^[3], and the report does not break out the company's own custody or trading revenue.

The 2023 round implies a workforce near 375 before that cut and about 300 after it ^[3]. By last February the payroll was back near 400, a third above that low point ^[4]. The new cut takes back about two-thirds of the rebuild ^[5].

In 2021 the trust charter from the Office of the Comptroller of the Currency put Anchorage among the few crypto firms with federal banking authority ^[10]. Circle, Coinbase and BitGo have since received similar charters, adding competition in institutional custody ^[11]. Across the industry, trading volumes, custody balances and fee income have been under pressure through a downturn of roughly a year, according to the same report ^[4]. No public statement has tied Anchorage's cut to a lost client, a regulatory sanction or a failed product ^[12].

That leaves three explanations. On the cyclical reading, bitcoin sits about a third below its record ^[6], and Anchorage will rehire when volumes return, as it did after 2023. The competitive reading says four firms with similar charters now chase the same institutional balances ^[8], so a cost base built while the charter was rare is too big for a shared market. A third possibility is the listing. Anchorage's stablecoin work was widely seen as a step toward an IPO ^[14], and a smaller payroll would improve the margins a prospectus would show.

I think the competitive explanation will last longest, because crypto prices have recovered before and the charter will not become rare again. The case against that is Anchorage's own history. Company officials said the 2023 cuts reflected broader industry conditions ^[9], and the company rebuilt anyway ^[4]. If the payroll heads back toward 400 within a year of a bitcoin recovery, the cyclical reading was right and mine was wrong.

Tether's stake is a separate puzzle. The $100 million is about 2.4% of a $4.2 billion valuation ^[7], and Tether is also the issuer of USAT, a stablecoin Anchorage works on ^[15]. The $4.2 billion is a price a business partner agreed for a small stake. A listing would ask outside buyers to value the whole company after its second large staff cut since March 2023 ^[8].