Crypto Exchange Kraken Denies Rumor of Office Closure, Security Breach

Crypto exchange Kraken is denying rumors that it is shutting down a service center, though it confirmed that it laid off some of team members.

AccessTimeIconSep 6, 2018 at 10:30 a.m. UTC
Updated Sep 13, 2021 at 8:21 a.m. UTC

U.S.-based cryptocurrency exchange Kraken has denied a rumor that has emerged on social media claiming the firm is shutting down operations at one of its service centers amid a security issue.

Reddit user "throwaway34034324" posted a thread on Thursday claiming that the exchange is closing operations in Halifax, Canada, and has "just laid off hundreds of people in response to a security [breach]."

Another user, "MysteriousPlankton," who is apparently one of the Halifax employees, commented on the thread that they were asked to accept voluntarily resignation with eight weeks' pay as a "severance package" or risk being laid off.

They added:

"Security everywhere, required to hand in door fobs. Sitting in lunchroom, get told that due to volumes being down (both trading and support ticket), and in light of the opening of a new office in Asia, we need to reduce costs, and layoff of recently hired (<3 months, approx 57 people) was not enough."

The same user also specified that the staff allegedly impacted from back-office operations, including those conducting know-your-customer/anti-money laundering processes, security and investigations, and deposits and withdrawals processing.

"The layoffs cover just about every aspect of their business," they stated.

While Kraken has not yet made any official statement to address the issue, its customer support operation replied to at least two inquiries on Twitter to deny most of the allegations.

"We can confirm that we are not shutting down any operations in any specific place, and there has been no security breach. Everything is fine & secure," the exchange said.

On Twitter, Kraken co-founder and CEO Jesse Powell confirmed that the company had "laid off about 10 percent of [its] client services team in [a] cost-saving measure," but likewise denied that there was any security breach or that hundreds of individuals had been laid off.

Some employees were offered an optional resignation package, he said.

"No other teams affected, still aggressively hiring globally for all functions," he said.

Business Insider reported in February that the San Francisco-based exchange had been planning to increase its total manpower by 800 people in 2018. Yet, as CoinDesk reported in April, Kraken took the decision to cut off its services to Japanese investors "due to the costs and resources required to maintain service in Japan."

Editor's note: This article has been updated with further details from Kraken co-founder and CEO Jesse Powell. 

Kraken image via Shutterstock


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