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In Galaxy, you may be far, far away from safe.

Goldman, Morgan Stanley technologists may regret crypto moves

Not so long ago, around the time of 2021's Q4 earnings report, Mike Novogratz, CEO of crypto firm Galaxy Digital, spoke on their approach to hiring. “How do you invest for growth? You hire, hire, hire,” said Novogratz.  He boasted of the company’s “innovative ways to attract new talent” and declared a “big engineering focus”.

Close to one year on, the company has found itself with a number of high-profile technologists, but will those hires soon come to regret their moves? 

After a year of hiring, it seems layoffs may be coming at Novogratz's firm. Bloomberg reported yesterday that Galaxy is exploring the possibility of laying off 15% to 20% of its workforce after mentioning “selective shrinking” in its Q2 earnings call earlier this year.  

This comes just a few months after the heavily publicized debacle that was Coinbase’s mass layoffs. Coinbase employed 5,000 people and cut around 1,000 of them. Galaxy employs 375 and is seemingly cutting 75 or so. It's not as painful, unless you work for Mike. 

When Coinbase cut in June, there was a strong sentiment that next time crypto firms tried hiring from banks no one would join them. However, Galaxy digital, or the Goldman Sachs of crypto firms as Novogratz imagines it, doesn't seem to have had that problem. Galaxy has made many hires in the past year, and many have come from investment banks.  

In February, before the crypto winter truly set-in, Alexander Field, Galaxy's VP of engineering, joined after a 14-year career at Goldman Sachs, where he was latterly an MD.  More recently, and at a more junior level Nick Dermott, at VP in risk technology, came from Morgan Stanley in September. In July, Galaxy hired Tanvir Madan who spent over five years at hedge fund Bridgewater Associates, as a managing director.  

The apparent upcoming layoffs will could cause a few regrets among Galaxy's recent joiners. Novigratz said before in that earnings report that “what gets [him] most excited is human capital;” well, now’s the time to prove it. 

As for the ‘TradFi’ transfers, they will be extra wary in the coming months as they look to avoid a repeat of the Coinbase saga. The threat of major layoffs has become part of the crypto landscape, whether crypto CEO's acknowledge it or not. 

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Have a confidential story, tip, or comment you’d like to share? Contact: alex.mcmurray@efinancialcareers.com in the first instance. 

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AUTHORAlex McMurray
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