Digital Currency Group (DCG), the parent company of CoinDesk, is closing down its trade execution and prime brokerage services unit, TradeBlock, citing crypto winter and regulatory uncertainties.
The shutdown of the unit, which provides trading services to institutional investors, will be effective as of May 31, a DCG spokesperson told CoinDesk in an emailed statement. "Due to the state of the broader economy and prolonged crypto winter, along with the challenging regulatory environment for digital assets in the U.S., we made the decision to sunset the institutional trading platform side of the business, known as TradeBlock, effective May 31, 2023," the spokesperson said.
The story was first reported by Bloomberg.
TradeBlock was acquired in 2020 by CoinDesk, and was later spun out as its own standalone business. CoinDesk kept the index data business from the acquisition, which was rebranded as CoinDesk Indices, which "has proven to be a successful acquisition," the spokesperson said.
DCG reported a loss of $1.1 billion in 2022 as it suffered the effects of the crypto bear market and ended the year with just $262 million in cash. However, the firm saw a better first quarter this year, as its revenue rose 63% from the previous quarter due to soaring crypto prices. DCG also projected, based on the first quarter's performance, that it's headed toward 2023 revenue and Ebitda of about $620 million and about $140 million, respectively – excluding the Genesis business, which remains in Chapter 11.
CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk offers all employees above a certain salary threshold, including journalists, stock options in the Bullish group as part of their compensation.