Anchorage Digital, the federally chartered crypto bank that counts Tether among its investors, has reportedly cut 17% of its workforce as the prolonged downturn in digital asset markets finally caught up with one of the industry’s best-capitalized institutions.
The Information reported on October 2, citing people familiar with the matter, that CEO Nathan McCauley informed employees of the workforce reduction during the week. The report framed the layoffs against a backdrop of weak crypto markets, a stark contrast to the momentum the bank displayed earlier in the year when it secured a 4.2 billion USD valuation and a 100 million USD strategic investment from Tether.
If the headcount McCauley cited in congressional testimony in February remains accurate, the reduction would equal roughly 68 jobs. In that February testimony, McCauley put Anchorage’s global workforce at approximately 400 employees. Because that figure covers employees worldwide, the calculation represents a possible company-wide reduction rather than a confirmed number of positions eliminated in any single country.
The layoffs land at an awkward moment for the company. Anchorage Digital Bank, N.A. is the legal issuer of USAT, Tether’s dollar-backed stablecoin built for the U.S. federal framework established under the GENIUS Act. USAT entered the market on January 27, and Tether announced its 100 million USD equity investment in Anchorage on February 5, describing it as an expansion of the companies’ existing working relationship around custody, staking, governance, settlement and stablecoin issuance.
Tether’s announcement made clear that its experience working with Anchorage’s banking and compliance infrastructure on USAT informed the investment decision. Under the launch arrangement, Cantor Fitzgerald serves as reserve custodian and preferred primary dealer, while Bybit, Crypto.com, Kraken, OKX and MoonPay were named among the platforms supporting the first phase of the rollout. For American users, Tether was careful to set expectations: USAT is not legal tender, is not backed or guaranteed by the U.S. government, and carries no FDIC or SIPC insurance.
Despite the headline reduction, Anchorage has kept expanding its institutional staking and settlement footprint through 2026. On September 21, the bank announced a partnership with LayerZero to provide cross-chain infrastructure for stablecoins issued through its banking platform, with USAT named as the first token to use the arrangement. LayerZero’s Omnichain Fungible Token standard allows an issuer to maintain a unified token supply across multiple blockchains, with Anchorage handling regulated issuance while LayerZero connects token deployments across supported networks.
The bank has also pushed into unusual corners of the tokenization market, including custody support for tokenized uranium, a niche that illustrates how far federally chartered digital asset banks are reaching beyond plain Bitcoin custody.
The market context helps explain the timing. Bitcoin briefly recovered above 87,000 USD on Friday, October 2, according to the report, but remains far below its 126,000 USD peak from October 2025. A full year of sideways-to-lower price action compresses the fee revenue and custody balances that institutions like Anchorage depend on, and staking yields tied to proof-of-stake networks have thinned alongside broader altcoin weakness.
The staffing cut also fits a wider pattern across the crypto industry this quarter, where firms that raised at premium valuations during the 2025 cycle are rationalizing costs rather than attempting new fundraising at lower marks. Anchorage’s 4.2 billion USD valuation was set earlier this year, and the entrance of Tether as a shareholder gave the bank an unusual strategic backer whose own stablecoin ambitions run directly through Anchorage’s charter.
For staking clients and institutional counterparties, the immediate operational question is whether service levels hold through the reduction. Anchorage has not publicly detailed which teams are affected, and the company had not responded publicly to the report at the time of writing. The OCC, which supervises Anchorage Digital Bank as a national trust bank, also has not commented.
What remains clear is that Anchorage’s strategic direction is unchanged in one respect: the bank continues to position itself as the regulated issuance and staking rail for dollar-backed tokens, with USAT and the LayerZero integration as proof points. Whether a leaner organization can execute that roadmap through a market downturn that shows few signs of reversing will be one of the more closely watched institutional stories of the coming quarters, and a stress test for every crypto bank that expanded aggressively at the top of the cycle.
4.2B valuation in february, 17% layoffs by october. tether’s 100M bought a front row seat to the downturn
GENIUS act stablecoin issuer cutting 17% is not the flex tether signed up for lol
Roughly 68 jobs if the February headcount still holds. The USAT launch in January feels like a different market entirely.
Even federally chartered, well-capitalized banks are cutting staff now. The downturn finally reached the layer that always claimed immunity.
17% of 400 is what, 68 people? tether drops 100m on these guys in february and by october its layoffs. brutal sector we’re in
The 100 million was for the USAT infrastructure, not payroll. Still ugly timing eight months after a 4.2 billion valuation.
mccauley told congress 400 employees back in february. if that number still held this week those are real jobs gone, not a rounding error