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By Jason Nelson and Andrew Hayward
Dec 29, 2022Dec 31, 2022
10 min read
As the crypto market declined in 2022, the departures began en masse. Several high-profile CEO stepped down from their respective roles at the head of crypto-centric firms in 2022, including Jesse Powell of Kraken, Michael Saylor of MicroStrategy, Alex Mashinsky of Celsius, and Sam Bankman-Fried of FTX.
The reasons given for stepping down vary—the bankruptcy of their company for some, for others, the volatility of the crypto market or a transition to a new phase for the firm.
The collapse of Terra sent ripples throughout the crypto universe, and several companies, including Three Arrows Capital, Voyager Digital, and FTX became insolvent and ceased operations.
While Terraform Labs CEO Do Kwon did not step down or resign—meanwhile becoming an international fugitive—the leadership at other companies began to fall like dominos. Here's a look at some of the biggest departures this year in order of when they happened.
Bitcoin mining hardware company Compass Mining saw the first big move in June as the crypto market imploded, when co-founder and CEO Whitney "Whit" Gibbs resigned alongside Chief Finance Officer Jodie Fisher.
Compass had come under fire for allegedly failing to pay utility and hosting bills tied to a facility in Maine owned by Dynamics Mining. "All you had to [do] was pay $250k for 3 months of power consumption," Dynamics tweeted at Compass in June.
"Compass Mining was created to make mining easy and accessible," the company said following the resignations. "We recognize that there have been multiple setbacks and disappointments that have detracted from that objective."
The firm ultimately took its case against Dynamics to court, however—and on December 30, Compass announced that it had won the case, obtaining a nearly $1.5 million judgment. Compass said that it "is not clear whether [it] will be able to collect."
In July, Algorand CEO Steven Kokinos departed the company behind the layer-1 blockchain platform of the same name, saying that he was eager to explore "other interests." Algorand, which has attracted the likes of FIFA and Napster to build on its platform, promoted COO Sean Ford to be its interim CEO.
Kokinos, who will serve as a senior advisor to Algorand into mid-2023, isn't going far: he said he planned to work more closely with projects that are building on the platform.
Crypto broker Genesis took a couple hard hits in 2022, including being the biggest creditor of the collapsed Three Arrows Capital—to the tune of $2.36 billion—and being impacted by FTX's downfall as well. In August, following the Three Arrows revelations, CEO Michael Moro stepped down.
“It has been an honor to lead Genesis for nearly a decade, and I look forward to supporting the company’s next phase of growth,” Moro said upon the announcement, noting that he would advise the firm through the transition.
Genesis announced a 20% reduction in staff at the same time, and named COO Derar Islim as interim CEO. In November, Genesis Trading halted all withdrawals from its lending arm due to the impact of the FTX collapse. The Digital Currency Group-owned Genesis reportedly owes Gemini Earn customers some $900 million, among other liabilities.
In August, Sam Trabucco, co-CEO of Alameda Research, stepped down, citing a desire to relax. Trabucco's co-CEO Caroline Ellison continued as Alameda's sole CEO until the firm filed for bankruptcy alongside FTX in November.
"I can't personally continue to justify the time investment of being a central part of Alameda," Trabucco said of his departure. "Everyone works really hard here, and spending a 'normal' amount of time at work is tricky—especially when you're trying to be a leader."
In hindsight now, of course, there are questions about how much Trabucco knew about Alameda's trading losses this summer and how FTX customer funds were used to help plug the hole in its balance sheet.
Last year, when @SBF_FTX announced that Caroline and I were Alameda's co-CEOs, the goal for all involved was to bring titles in line with reality — the two of us had been acting as CEOs for quite some time, and we wanted our outside image to reflect that.
— Sam Trabucco (@AlamedaTrabucco) August 24, 2022
Prolific Bitcoiner Michael Saylor also stepped down from his position as CEO of cloud software company MicroStrategy in August. While no longer CEO, Saylor retains a leadership position as executive chairman for the company he co-founded in 1989.
While MicroStrategy's core focus is not on cryptocurrency-related services, the company has rapidly become known for holding the largest stash of Bitcoin by a public company. As of December 28, when it last disclosed its BTC holdings, MicroStrategy said that it held about 132,500 BTC—or $2.2 billion worth today. But the company spent over $4 billion to acquire that BTC since 2020.
When announcing the move in August, Saylor said that he would continue to lead its "bitcoin acquisition strategy." He added, "My focus is bitcoin advocacy and education, like with the Bitcoin Mining Council, and being spokesperson and envoy to global bitcoin community."
In September, FTX US President Brett Harrison suddenly stepped down to move into an advisory role with the firm. Harrison announced his resignation on Twitter, saying he intends to stay in the crypto industry.
"I'm remaining in the industry with the goal of removing technological barriers to full participation in and maturation of global crypto markets, both centralized and decentralized," he wrote.
1/ An announcement: I’m stepping down as President of @FTX_Official. Over the next few months I’ll be transferring my responsibilities and moving into an advisory role at the company.
— Brett Harrison (@BrettHarrison88) September 27, 2022
"Until then, I'll be assisting Sam [Bankman-Fried] and the team with this transition to ensure FTX ends the year with all its characteristic momentum," he said, attempting to sound optimistic. Unfortunately, Harrison's optimism did not save FTX, who has claimed to be separate from FTX US, from filing for Chapter 11 bankruptcy protection in November.
Harrison commented on the FTX fallout in mid-December without mentioning his former employer by name, tweeting that he "had no personal experience with harmful, consequential betrayal in my life until recently.
He added that he "can only thank God I will never know or recognize in myself that kind of pathological, corrupting selfishness. It is malign and poisonous." Harrison also said that he's excited to start his new company and that he "will not abandon this industry."
Kraken CEO Jesse Powell then stepped down in September. Powell said that as Kraken grew, running the company became more of a drain and "less fun." He said he plans to stay engaged with the company he founded in 2011.
In June, Kraken was embroiled in controversy when it took a firm stance on what was described as "anti-woke" sentiment, instead urging staff to focus on crypto instead of cultural and diversity issues. In a much-debated Twitter thread, Powell suggested that any employees "triggered" by the mandate should leave the company.
In November, Kraken announced that it would cut roughly 1,100 employees, reducing its headcount by 30%, citing broad economic concerns and the effects of the ongoing crypto bear market.
9/ Most people don't care and just want to work, but they can't be productive while triggered people keep dragging them in to debates and therapy sessions. The answer for us was to just lay out the culture doc and say: agree and commit, disagree and commit, or take the cash✌️
— Jesse Powell (@jespow) June 15, 2022
Celsius CEO Alex Mashinsky resigned as the head of the bankrupt crypto lender Celsius Network in September.
"I elected to resign my post as CEO of Celsius Network today," said Mashinsky in a statement. "Nevertheless, I will continue to maintain my focus on working to help the community unite behind a plan that will provide the best outcome for all creditors—which is what I have been doing since the company filed for bankruptcy."
In his resignation, Mashinsky said that his continued role as CEO had become an increasing distraction and that he is sorry for the "difficult financial circumstances" faced by the Celsius community. Mashinsky's resignation came two months after Celsius filed for Chapter 11 bankruptcy.
Moments ago, @CelsiusNetwork filed voluntary petitions for Chapter 11 protection and announced that the company initiated a financial restructuring. https://t.co/vf5wsT6TMp
— Celsius (@CelsiusNetwork) July 14, 2022
Celsius' troubles began after the company paused all customer withdrawals in June, citing liquidity issues. This announcement prompted Alabama, Kentucky, New Jersey, Texas, and Washington regulators to open investigations into the company.
In September, Celsius co-founder Daniel Leon resigned from his role as chief strategy officer of the embattled company. While Leon left with 32,600 shares of Celsius stock acquired in February 2018 and dividends, Financial Times uncovered that Mashinsky withdrew $10 million from the company's account in May before the platform halted user withdrawals.
Gavin Wood, Ethereum co-founder and CEO of Polkadot maker Parity Technologies, stepped down from the role in October. Although Wood departed the CEO position, he remains Parity's majority shareholder and chief architect.
According to Bloomberg, Wood decided to step down because serving as chief executive had limited his ability to pursue "eternal happiness." Polkadot's DOT cryptocurrency is now down 92% from its November 2021 peak price, outpacing the likes of Bitcoin and Ethereum on that front.
On November 11, one-time crypto icon Sam Bankman-Fried resigned as CEO of FTX as the company filed for Chapter 11 bankruptcy.
Bankman-Fried's resignation came nearly a week after Binance CEO Changpeng "CZ" Zhao said on Twitter that the world's largest cryptocurrency exchange would liquidate its entire position in FTX's FTT token. Just days later, Binance—which signed a non-binding letter of intent to acquire FTX amid the liquidity crunch that ensued—said it would not follow through after completing due diligence. Binance was an early investor in FTX in 2019.
As a result of corporate due diligence, as well as the latest news reports regarding mishandled customer funds and alleged US agency investigations, we have decided that we will not pursue the potential acquisition of https://t.co/FQ3MIG381f.
— Binance (@binance) November 9, 2022
New FTX CEO John J. Ray III—who was brought in to help manage the bankruptcy process—has taken steps to distance FTX from its former leader, saying that Bankman-Fried does not speak for the company and has no active role.
Bankman-Fried has since been arrested and charged by U.S. federal prosecutors as well as the Securities & Exchange Commission (SEC), plus he's been sued alongside FTX and Alameda by the U.S. Commodity Futures Trading Commission (CFTC). He was recently extradited from the Bahamas to the United States and released from custody via a $250 million bond agreement.
Caroline Ellison, the remaining CEO of Alameda Research after the resignation of Sam Trabucco in August, was terminated from her position when FTX and several of its subsidiaries, including Alameda, filed for bankruptcy in November.
Ellison became the focus of media scrutiny not only for the questionable business practices of Alameda Research and FTX, but also for a Tumblr blog that expressed views on polyamorous relationship dynamics and Race Science. Her relationship with Bankman-Fried has also come under scrutiny, not only as a case of nepotism but also as the potential involvement of Ellison in FTX's alleged financial crimes.
She has since flipped on her former ally and and lover, pleading guilty to charges from federal prosecutors and the SEC alike with plans to cooperate and provide information regarding Bankman-Fried and his companies' alleged wrongdoing. Ellison reportedly told a judge that she knew what she was doing at Alameda was both wrong and illegal.
After the especially dramatic entries above, the final CEO move on this list is decidedly tame by comparison. Nicole Muniz, the first CEO of Bored Ape Yacht Club creator Yuga Labs, said that she will depart the role in the first half of 2023 to clear the way for a new chief executive, Daniel Alegre.
Alegre joined after being President and COO of Activision Blizzard, the gaming giant behind franchises like Call of Duty and Candy Crush Saga. The move signaled Yuga's growing embrace of Web3 gaming with Otherside. Muniz will stay on as a partner and advisor after the move is completed. Yuga Labs raised $450 million at a $4 billion valuation in March.
"I am thrilled that we found Daniel to keep up the momentum and bring his gaming expertise to hugely ambitious projects like Otherside," she said in a statement.
Editor's note: This article was updated after publication to include details of the Compass Mining court verdict.
