The layoffs at the London-based exchange are in response to “significant” change in market volume, according to Obi Nwosu, Coinfloor’s chief executive, and are seen as a setback for the country’s fintech industry, as the exchange is backed by Taavet Hinrikus, founder of TransferWise, as well as Passion Capital. Adam Knight, a former Goldman Sachs and Credit Suisse director, has also supported the exchange, whose customers had traded about $1 billion in the last 12 months, Nwosu said.
While Nwosu confirmed the layoffs, he did not confirm the number of employees affected. He said it is typical for a company to adjust staff based on the market, and Coinfloor has experienced a “significant change” in trading volume as cryptocurrency prices declined throughout most of the year and stagnated in recent weeks.
Alternative Platforms Emerge
Since Coinfloor was started in Oct. 2013, numerous cryptocurrency trading platforms have been introduced, with more than 200 cryptocurrency exchanges worldwide, according to CoinMarketCap.
Coinfloor is geared to financial professionals interested in bitcoin. Mark Lamb, who was chief executive at the time of its launch, told Financial News it wanted to attract financial institutions to invest in bitcoin.
This past March, Coinfloor became the first exchange to announce plans for a futures exchange for digital assets to include physically-delivered bitcoin futures contracts. The exchange was intended to allow investors, traders, hedge funds, and miners to have access to cryptocurrency contracts supported by institutional governance. The exchange, called CoinfloorEX, was intended to protect traders from price changes on positions at settlement time and against market manipulation.
Competition Intensifies For Institutional Market
Several other companies have since emerged targeting the same investor group. Senior executives from Omni Partners, a $1.4 billion hedge fund, in April launched Archax, a cryptocurrency exchange targeting institutional investors. Archax hired former London Stock Exchange strategist David Lester in June as a senior adviser, FN reported.
Featured Image from ShutterstockGet Exclusive Crypto Analysis by Professional Traders and Investors on Hacked.com. Sign up now and get the first month for free. Click here.