Circle, a popular cryptocurrency finance company, has announced that it will be pumping the brakes on its Circle Research division for the time being.
The pause in activities was made formal in a blog post published earlier this week, when the Circle team claimed that while the research division has provided some “significant progress,” they would need to make a few cutbacks.
Expatiating, the Circle team said,
The Goldman Sachs-backed finance firm launched Circle Research on October 9, 2018, claiming that the division will help provide research and valuable insights into the cryptocurrency market and prevalent trends. This, they hoped, will help cryptocurrency traders make between decisions and maximize their earnings from the space.
However, it would seem that things haven’t gone as smoothly. The recent release didn’t specify a date when Circle Research will return, so it really is anyone’s guess at this point.
The cutback could also be a part of some seismic changes that have been occurring at Circle. While the recent release said nothing specific about why Circle Research was paused, the finance firm hasn’t exactly had the smoothest year, thanks to regulatory difficulties.
Regulatory setbacks force layoffs
Back in May, Jeremy Allaire, the chief executive of the firm, announced via a social media post that the company would be laying off 30 members of staff.
In his tweet, as well as an official announcement which was posted on the Circle blog, Allaire claimed that the trim was necessary, as he also blamed a hostile regulatory climate for the move. The blog post contained explanations that operating in the United States has become more strenuous, and to stay afloat, the company’s executives decided to let go of about 10 percent of its workforce.
Today we made organizational changes at Circle and eliminated approximately 30 positions, which is about 10% of our employees. We made these changes in response to new market conditions, most importantly, an increasingly restrictive regulatory climate in the United States.
— Jeremy Allaire (@jerallaire) May 21, 2019
Before the layoffs were confirmed, Poloniex, the cryptocurrency exchange platform that is owned by Circle, had restricted U.S. traders from accessing certain trading pairs.
At the time, Allaire expressed his displeasure at the slow progress that the United States has shown in ensuring that the entire country has a set of sweeping, encompassing crypto rules. However, he also expressed optimism that there would be some improvements in the future.
Poloniex moves shop
In addition to the firing, Circle made the decision to take Poloniex out of the United States completely. Back in July, Circle announced that it was moving Poloniex to the crypto-friendly island of Bermuda, in a bid to better serve its non-U.S. customers.
In an interview with news medium CoinDesk, Allaire revealed that up to 70 percent of the exchanges customers don’t reside in the U.S. With this move, the exchange was hoping that it could improve its service offering and availability to them.
It’s rather safe to say that regulatory uncertainties forced Circle to make this move as well. In the release, Circle commended Bermuda’s regulatory framework, while also reiterating its commitment to abide by the FATF- recommended Anti-Money Laundering standards.