Michael Bodley

It’s been a rough couple of weeks for crypto tax software startups.&nbsp;



ZenLedger trimmed its headcount by 10% this week, according to two sources familiar with the matter. The company’s chief executive, Pat Larsen, confirmed the personnel reduction in a statement on Friday.&nbsp;



The move marked the second such recent action by a startup in the niche and emerging sector. A larger ZenLedger competitor, Koinly, parted ways with about 14% of its own staffers in recent weeks, Blockworks previously <a href="https://blockworks.co/news/crypto-tax-startup-koinly-cuts-staffers-just-in-time-for-tax-season" target="_blank" rel="noreferrer noopener">reported</a>. Sources, in both cases, were granted anonymity to discuss sensitive business dealings. 



Both ZenLedger and Koinly’s layoffs appear to be curiously timed, with tax season right around the corner, at least in the US.



In ZenLedger’s case, half a dozen employees were let go Dec. 5 in a bid to “extend [the company’s] runway to several years” in terms of being able to “successfully navigate this time of high economic uncertainty in the crypto markets and the global macro economy,” Larsen told Blockworks.&nbsp;



Though the net number of affected employees is relatively minor — at least in the <a href="https://blockworks.co/news/latest-in-crypto-hiring-more-fall-victim-to-persistent-layoffs" target="_blank" rel="noreferrer noopener">scheme</a> of all things FTX-related — the <a href="https://blockworks.co/news/chainlink-adds-staking-after-cutting-sales-staffers" target="_blank" rel="noreferrer noopener">layoffs</a> are emblematic of the continued struggles of crypto companies large and small to make ends meet as the bear market drags on, both sources said. Even operations that have intentionally remained lean and nimble have been faced with tough decisions. The end goal, obviously, is to keep the lights on. 



Industry participants had expected retail and institutional digital asset traders alike to look for just about every avenue to lock in mounting 2022 capital losses in an effort to reduce tax liabilities. But, for whatever reason, that hasn’t quite panned out — at least not enough for the likes of ZenLedger and Koinly.&nbsp;



Koinly’s chief executive had said in a statement this week that the startup had noticed a “lack of awareness” on the behalf of crypto investors when it comes to booking crypto losses for tax gains. Losses on digital assets — just like those on stocks — can be used in the US to reduce tax liability for gains in future years&nbsp;&nbsp;



ZenLedger informed employees of the layoffs in a company-wide meeting, Larsen said, adding that the company is helping former employees “transition to new roles as needed.”



Even with the cuts, ZenLedger’s revenue and new customer pipeline grew about 100% year-over-year through the October 2022 deadline in the US for filing federal tax returns on extensions, according to Larsen.



“We remain a highly talented and capable team that will use 2023 and beyond to expand to international markets and continue to innovate with new enterprise and government products,” he said.



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Another Crypto Tax Software Startup Is Laying Off Staffers

Ben Strack

<div id="highlights-block_6262c046eb8fd" class="highlights">
 <ul>
 <li>ZenLedger added four members to its team of executives</li>
 <li>An enterprise cloud platform hired its first-ever chief cryptocurrency officer</li>
 </ul>
 
</div>



Binance appointed Steven McWhirter as its director of regulatory policy and Seth Levy as head of market surveillance, marking the latest former financial regulators to enter the crypto world.



McWhirter spent nearly a decade at the United Kingdom’s <a href="https://www.fca.org.uk" target="_blank" rel="noreferrer noopener">Financial Conduct Authority</a> (FCA) where he was most recently a strategy and engagement manager in the regulator’s data, technology and innovation division.



Levy previously worked for about five years at Citadel and Citadel Securities as the financial services company’s global head of surveillance. He also spent 16 years at the Financial Industry Regulatory Authority (FINRA), most recently as the senior director of trading analysis.



“Our goal is to ensure that Binance users are protected from any form of nefarious activity or bad actors,” Levy said. “We will work to further proactively engage regulators and other market participants to strengthen market integrity, user protection and enhance public confidence in the crypto market.”



Kraken hired Mayur Gupta as its chief marketing officer as the crypto exchange aims to continue “aggressively” expanding its 3,000-employee workforce.



Gupta spent the last two-plus years at media company Gannett as the company’s chief marketing and strategy officer, according to his LinkedIn profile. Before that, he held similar roles at Spotify and meal delivery company Freshly.



As the global vice president for growth and marketing at Spotify, he led the expansion of the audio streaming provider’s free and premium products and was responsible for performance, retention and product marketing, as well as data science and analytics.



Mayur’s addition follows Kraken bringing aboard Chief Financial Officer Carrie Dolan, Chief People Officer Pranesh Anthapur and Mike Davidson, Kraken’s new vice president of design.



<a href="https://www.zenledger.io" target="_blank" rel="noreferrer noopener">ZenLedger</a> has added four members to its C-suite. Founded in 2017, the company collects, analyzes and accounts for transaction information across thousands of exchanges, wallets and tokens.



Joining ZenLedger is Duyane Norman as chief strategy officer, Daniel Escobar as chief technology officer, Jonté Harrell as chief financial officer and Greg Adams as chief operations officer.&nbsp;



Norman retired from the CIA in 2019 after nearly three decades with the organization and went on to work for the Defense Innovation Unit. Escobar spent the last four years as head of enterprise onboarding and engineering services with bitcoin payment service provider Bitpay.



Harrell is a former US Army captain and combat veteran who more recently led financial planning and analysis for Amazon&#8217;s delivery businesses. Adams, a former major in the US Army Special Forces, was the co-founder and CEO at startup Stabilitas. He also led innovation and mergers and acquisitions efforts at OnSolve as chief strategy officer until December 2021.



Cloud platform Phunware has hired Matt Lull as its first-ever chief cryptocurrency officer.&nbsp;



Lull previously spent 18 years at Citrix Systems in roles including managing director of technology strategy for cloud innovation partners.



“The decentralized web is currently positioned to be the next major wave of computing and we here at Phunware plan to be at the tip of the proverbial spear in helping sovereign people worldwide reap its core utility, benefits and freedom at scale,” Lull said in a statement.



Blockchain fintech company XREX hired Michael Shing as its director of risk management.&nbsp;



Shing will be tasked with building thought leadership through regulatory research and outreach as a way to help XREX better drive blockchain adoption and integrate with traditional banking systems.



He formerly worked at the Federal Reserve Bank of San Francisco and the New York Fed, first as an analyst and then as a senior risk specialist.



CISOs Connect, a community of cybersecurity leaders, has appointed former Federal Reserve Bank of New York regulator David Cass as its president.



Cass also recently joined crypto market maker GSR as global chief information security officer.



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Start your day with top crypto insights from David Canellis and Katherine Ross. <a href="https://blockworks.co/newsletter/empire">Subscribe to the Empire newsletter</a>.



Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. <a href="https://blockworks.co/newsletter/onthemargin">Subscribe to the Forward Guidance newsletter</a>.



Get alpha directly in your inbox with the <a href="https://blockworks.co/newsletter/research">0xResearch newsletter</a> — market highlights, charts, degen trade ideas, governance updates, and more.



The Lightspeed newsletter is all things Solana, in your inbox, every day. <a href="https://blockworks.co/newsletter/lightspeed">Subscribe to daily Solana news</a> from Jack Kubinec and Jeff Albus.