Closing 8 ETFs, Cutting 14% of Staff—Why Is Bitwise Still Launching New Products?
- Key Takeaway: Crypto asset manager Bitwise has laid off approximately 14% of its workforce (down from 180 to 155 employees) after client assets declined by at least $4 billion and eight ETFs were liquidated, while shifting resources toward new tracks such as staking and tokenized funds.
- Key Elements:
- Bitwise cut about 25 positions, reducing headcount from 180 to 155. The CEO stated the adjusted team remains the largest in company history, but did not disclose affected departments or severance packages.
- Client assets fell from over $1.5 billion in February to $1.1 billion disclosed in May—a paper shortfall of at least $400 million—though the impact of price volatility, subscriptions/redemptions, and scope changes was not broken down.
- Between April and August, Bitwise liquidated eight ETFs in total, including a Web3-themed fund, a Bitcoin/Ethereum rotation strategy fund, and six options income ETFs.
- During the same period, the company launched an Avalanche ETP and a Hyperliquid ETF, while taking over Superstate's Crypto Carry Fund with over $267 million in assets, betting on the tokenized fund space.
- As of the end of June, Bitwise managed 70 investment products, served over 5,500 clients, and partnered with more than 20 institutions. The product restructuring will impact the operational burden on the remaining team.
Original author: ChandlerZ, Foresight News
Bloomberg reported on August 12 that crypto asset management firm Bitwise has cut approximately 14% of its workforce. Bitwise subsequently confirmed via email that headcount has fallen from around 180 to roughly 155, which, based on these two rounded figures, equates to a reduction of approximately 25 positions. The company did not disclose the specific departments affected, compensation packages, or subsequent restructuring plans.
Bitwise CEO Hunter Horsley stated in response that the adjusted team remains the largest in the company's eight-year history, and he expects the firm to continue growing as crypto assets become integrated into the global economy. The company remains optimistic about long-term growth, but current staffing and product allocation have already begun to tighten.
Several crypto companies have also downsized their teams this year. Coinbase cut approximately 700 employees in May, accounting for 14% of its global workforce, with official statements citing market volatility, cost control, and AI-driven organizational restructuring. On-chain data platform Dune laid off 25% of its staff the same month, with its CEO also citing AI efficiency gains. BitGo reduced its workforce by 15% in June, reallocating resources toward security, trading, stablecoins, settlement, and AI infrastructure. Bitwise has not yet disclosed the specific reasons behind this round of layoffs, nor has it attributed them to AI. Whether there is an organizational-level correspondence between this workforce reduction and product adjustments remains unconfirmed.
Client Assets Down at Least $4 Billion, Eight ETFs Subsequently Delisted
Prior to the staffing adjustments, Bitwise's disclosed client asset figures had already shown notable changes. When Bitwise issued a product announcement on February 3, it stated that client assets exceeded $15 billion. Another announcement released on May 1 showed that client assets stood at $11 billion as of April 1. Based on the company's two self-disclosed figures, the book difference amounts to at least $4 billion. Bitwise did not specify how much of this change was attributable to token price movements, subscriptions/redemptions, and changes in statistical scope, respectively.
Client assets are a statistical metric influenced by both market prices and fund flows. Price appreciation or depreciation changes asset market value, client subscriptions and redemptions alter assets under management, and newly launched or terminated products can also shift the statistical scope—data from two points in time cannot isolate the individual contributions of these factors. Bitwise has not published relevant breakdowns, so the at least $4 billion reduction cannot be directly equated with net client redemptions.
Bitwise's business includes ETFs, private funds, separately managed accounts, staking, and on-chain investment products. Fee structures and billing bases vary across product types, and the company has not disclosed changes in asset composition between the two reporting dates. The disclosed client asset base narrowed significantly between the two points in time, putting pressure on the asset base available for fee-generating asset management activities.
Product exits occurred almost concurrently during the same period. On April 30, the Bitwise Funds Trust board decided to liquidate the Bitwise Web3 ETF and the Bitwise Trendwise BTC/ETH and Treasuries Rotation Strategy ETF; both funds ceased trading and completed liquidation in May. On June 30, the board again decided to liquidate six options income ETFs, linked to Coinbase, MARA, Strategy, GameStop, Circle, and Ethereum respectively; these funds ceased trading and distributed liquidation proceeds in August.
Within roughly three months, Bitwise had exited eight ETFs in a concentrated manner.
The first two funds covered Web3-themed equities and a rotation strategy between Bitcoin, Ethereum, and U.S. Treasuries, respectively, while the latter six generated income through options tied to individual stocks or Ethereum. The eight products had different investment theses, but shared a common need for ongoing trading, compliance, valuation, and disclosure support. Liquidation reduces the number of products requiring maintenance, though the revenue impact still depends on each fund's asset size and fee rates prior to liquidation.
Old Products Exit, New Resources Flow Toward Staking and Tokenized Funds
During the period when the eight ETFs were being phased out, Bitwise continued to add products in other directions. In April, the company launched an Avalanche ETP with built-in staking arrangements in the European market. In May, the Hyperliquid ETF went live. In June, the company took over Superstate's Crypto Carry Fund, which had over $267 million in assets, entering the tokenized fund management space.
These new products also generate custody, staking, compliance, and distribution requirements. The shift in product direction cannot be directly equated with a decline in overall operational burden. It demonstrates that the company remains willing to allocate resources to new tracks, while layoffs and product expansion simultaneously appear on the same business ledger.
In an announcement released on June 30, Bitwise stated that the company offers 70 investment products, serves more than 5,500 private wealth management teams, registered investment advisors, and family offices, and partners with over 20 banks and broker-dealers. The number of products means the company must continuously bear operational work including compliance, custody, trading support, information disclosure, and client service. With the team reduced by roughly one-seventh, the product structure will directly affect the operational complexity that remaining personnel must maintain.
When examining the concentrated liquidation of eight ETFs alongside new product launches during the same period, Web3-themed funds and single-asset options income strategies have exited, while products that directly track underlying crypto assets, offer staking yields, and tokenize fund shares on-chain continue to receive investment.
With headcount reduced from 180 to 155, the remaining product lineup will be managed by a smaller team. Bitwise has not yet specified which positions are tied to the product adjustments, nor has it disclosed one-time severance costs.
