Biggest Crypto C-Suite Departures of 2022

https://www.theblock.co/post/196653/biggest-crypto-c-suite-departures-2022

This was the year of exchange collapses, bankruptcies and the executives leaving their positions mid-scandal.  

Trouble started in May when the TerraUSD stablecoin de-pegged from the dollar before inevitably crashing — taking down its sister coin, Luna, with it. What followed was a domino effect of firms falling to their knees, including Celsius, BlockFi and the crypto exchange giant FTX.  

While numerous C-suite executives left their positions this year, The Block compiled the top 10 most memorable departures this year. 

Sam Bankman-Fried resigned as CEO of crypto exchange FTX 

FTX collapsed nearly a week after a scoop from CoinDesk revealed that Alameda Research, a trading firm established by Sam Bankman-Fried, held $3.66 billion in unlocked FTT, FTX’s token. Not only that, but Alameda had around $8 billion in liabilities — $7.4 billion worth of which were loans. The leaked balance sheet revealed an unusually close link between the firms. 

After Binance CEO Changpeng “CZ” Zhao revealed that the firm would sell off his FTT, which Binance received from selling off its FTX shares in 2021. FTT tanked by 19% and customers flocked to withdraw $8.2 million in funds before FTX inevitably paused such activity. Bankman-Fried insisted that “FTX is fine” before a failed acquisition deal from Binance.  

The former CEO of FTX resigned right as the company filed for Chapter 11 bankruptcy protection on Nov. 11. The firm was found to have over 100,000 creditors and up to $50 billion in liabilities.  The FTX exchange token, FTT, also crashed 90.6% in value the day before the firm filed for bankruptcy, according to The Block's Data Dashboard.

Sam Bankman-Fried was later arrested on charges including wire fraud, wire fraud conspiracy, securities fraud, securities fraud conspiracy and money laundering. The arrest occurred the day before Bankman-Fried was set to testify in front of the House Financial Services Committee in Congress regarding the FTX collapse and its wider impact on the crypto industry.  

Alameda Research co-CEO Sam Trabucco stepped down, leaving Caroline Ellison as sole CEO 

Sam Trabucco had been CEO of Alameda Research, a trading firm established by Sam Bankman-Fried, for one year before stepping down in August. His departure meant Caroline Ellison would be the only CEO of the trading firm.  

Following the leaked balance sheet that in part led to the downfall of FTX, Ellison attempted to downplay concerns by claiming that the balance sheet was incomplete and didn’t paint the full picture.  

Bankman-Fried’s successor John J. Ray III would later testify before the House Financial Services Committee that FTX executives had “free rein” over Alameda Research. In September, a week after Trabucco stepped down, Bankman-Fried considered closing down Alameda Research.  

Celsius CEO Alex Mashinsky resigned

Celsius’s former CEO Alex Mashinsky resigned from his position on Sept. 27. Before he departed, he was found to have taken $10 million before the firm froze withdrawals and eventually filed for bankruptcy protection on July 13.  

Mashinsky used these funds to pay back state and federal taxes amassed from his Celsius asset income. A Celsius creditor committee had called for his removal before he resigned.  

Genesis’s CEO Michael Moro left amid staff layoffs

Michael Moro, former CEO of the crypto lender Genesis Trading, stepped down from his role on August 17. Amid Moro’s departure, Genesis also cut 20% of its staff to meet “strategic priorities,” The Block previously reported.  

Gensis was a prodigious lender for other crypto firms, having $14.6 billion in active loans as of March of this year. Genesis would later pause customer withdrawals on Nov. 16 after taking financial hits from the collapses of crypto hedge fund Three Arrows Capital (3AC) and FTX.  

The firm owes creditors $1.8 billion, including $900 million to users of Gemini’s Earn program, in which customers lent their digital assets to third party borrowers to earn a yield. Gemini would pause its Earn customer redemptions on Nov. 16.  

Loans originating from Genesis have fallen steadily over 2022, according to data from The Block. Loans fell 8.8% between the first and second quarters of this year. 

OpenSea’s CFO Brian Roberts left after less than one year

Brian Roberts, former Chief Financial Officer to the NFT marketplace OpenSea, left his position on Oct. 8. Roberts joined OpenSea as CFO 10 months earlier in December of 2021. Roberts moved to an advisory role at OpenSea now. 

OpenSea was embroiled in controversy in June when its former head of product Nathaniel Chastain was charged with wire fraud and money laundering related to an insider trading scheme.  

Chaistain purportedly bought NFTs before they were featured on OpenSea’s front page, using confidential information to select these NFTs as Chastain was responsible for the featured home page NFTs. He would later claim the FBI violated his rights before his arrest and seek a subpoena against OpenSea in an attempt to omit “insider trading” from his case, The Block previously reported. 

Kraken’s CEO Jesse Powell moved to chairman position

Jesse Powell stepped down from his role as CEO of the crypto exchange Kraken on Sept. 21. He said this was because he wanted to focus on working on product and industry advocacy. Kraken’s then COO David Ripley ascended to CEO, and Powell now serves as chairman of the firm.  

Powell had been a controversial figure in the crypto industry. The U.S. Treasury Department has been investigating Kraken for allegedly allowing users in Cuba, Iran and Syria to trade digital assets despite sanctions. Kraken would later agree to pay $362,000 for violating Iran sanctions. 

Powell also made waves for a commitment to a specific culture at Kraken, one which focuses above crypto above all else and sets aside debates of pronouns and biological sex — whether it “triggers” employees or not.  

GameStop’s CFO Mike Recupero fired before a round of layoffs

GameStop’s CFO Mike Recupero was fired on July 7 amid company layoffs, CNBC reported. Recupero was reportedly too hands off and not a good fit for the role, and Diana Jajeh filled in the CFO position after being the firm’s Chief Accounting Officer.  

GameStop made several moves into the web3 gaming space. The firm built an NFT platform, supported by Immutable X, to sell web3 gaming assets. GameStop even announced a partnership with FTX on Sept. 7, in which the video game seller would offer FTX gift cards in its stores. 

GameStop would later have another “big” round of layoffs on Dec. 6 that affected its crypto team. The firm’s head of blockchain Matt Finestone departed the firm on Sept. 12.  

Voyager’s CFO Ashwin Prithipaul departed the troubled crypto lender

Ashwin Prithipaul departed as the bankrupt crypto lender Voyager’s Chief Financial Officer on Sept. 23. The firm filed for Chapter 11 bankruptcy protection on July 6 after pausing trading, withdrawals and deposits days before. Voyager was found to have over 100,000 creditors and more than $650 million in claims against the bankrupt hedge fund Three Arrows Capital. 

Before the firm’s collapse, FTX had won the auction to buy Voyager’s digital assets on Sept. 26. 

MicroStrategy’s Michael Saylor moved to an executive chairman position from his prior role as CEO on Aug. 2. By the end of the month, D.C.’s attorney general alleged that Saylor evaded over $25 million in taxes.

After buying up bitcoin in instances of $190 million, $25 million and $6 million this year, MicroStrategy would come to hold around 130,000 in bitcoin holdings, according to The Block’s Data Dashboard — despite missing its third quarter revenue estimates.  

Michael McCaffrey resigned as CEO of The Block

Michael McCaffrey resigned from his position as CEO of The Block after failing to disclose a combined $43 million in loans from Alameda Research.  

Beginning in 2021, McCaffrey, the former CEO and majority owner of The Block, took a series of loans from founder and former FTX and Alameda CEO Sam Bankman-Fried. McCaffrey resigned from the company in December 2022 after failing to disclose those transactions.

McCaffrey used $27 million in Alameda loans to finance The Block and to facilitate an employee buyout, in which McCaffrey would hold more than 50% of the company’s shares. He then used a $16 million loan to buy property in the Bahamas. 

The Financial Times first cited two of McCaffrey's shell companies, Red Sea Research and Lonely Road, as Alameda loan recipients on Dec. 6; Axios publicly linked the two companies to McCaffrey three days later. Former Chief Revenue Officer Bobby Moran became the new CEO following McCaffrey's departure.