Compass Mining Seeks Direction After Top Managers Resign

Compass Mining Seeks Direction After Top Managers Resign

Cryptocurrency mining and hosting company Compass Mining is cutting staff after two top executives resigned last week, admitting it was “growing too fast.”

In one Statement On Thursday, the company's recently appointed interim CEOs Thomas Heller and Paul Gosker said the size of the team would be reduced by 15%. Senior employees and the leadership team have taken pay cuts of up to 50%, they added.

While Compass' website doesn't indicate a specific number of employees, LinkedIn lists 83 employees. This suggests that around 13 people have lost their jobs.

“Although painful, these changes will allow Compass to remain agile and well-positioned in this evolving market that has challenged many of our industry peers,” the interim CEOs wrote.

“Of all the decisions we have had to make as new CEOs, this will be by far the most difficult, and we take full responsibility for all the changes that have been and will be made under our leadership.”

Compass appointed Heller and Gosker on June 28 after former CEO Whit Gibbs and CFO Jodie Fisher resigned. While there was no clear reason for her resignation, Compass recognized the “setbacks and disappointments” that have derailed the company from its goal of making crypto mining easy and accessible.

At the end of June, the company faced allegations from hosting company Dynamics Mining over alleged non-payment of electricity compensation. Compass disputed the claims and said Dynamics was operating at only about 1% of its contracted capacity.

“Compass has complied with all of its obligations under its contracts with Dynamics, including its financial obligations,” it said in a Statement.

The downturn in cryptocurrency markets, along with a liquidity crisis in the crypto lending space, has forced several companies to cut costs or lay off employees. Exchanges and lenders such as Coinbase, BlockFi, Gemini, Crypto.com, Vauld and Bullish are just some of the well-known names affected.

Bitcoin miners appear to be next on the chopping block and have been selling Bitcoin because their revenues have plummeted along with the bear market, said Marcus Sotiriou, an analyst at digital asset broker GlobalBlock.

Driven by recent market turmoil and rising energy costs, Core Scientific said On Tuesday, it sold 7,202 Bitcoin for about $167 million in June - leaving the miner with just 1,959 Bitcoin and about $132 million in cash. In the meantime, Argo Blockchain, Bitfarms, Uprising and CleanSpark have also sold their Bitcoin reserves to cover operating costs.

The post Compass Mining searches for “Direction After Top Execs Resign” appeared first on Blockworks.