FalconX, the digital-asset prime broker that acquired 21Shares last November, has reportedly cut about 10% of its workforce as it braces for what Bloomberg describes as a prolonged downturn in crypto markets. The staff reduction, reported Monday, comes as the firm looks to refocus its business and tighten spending across key regions.
According to people familiar with the matter cited by Bloomberg, FalconX is also reshaping its Singapore strategy—shifting emphasis toward crypto derivatives trading—and plans to withdraw its license application with the Monetary Authority of Singapore (MAS). Bloomberg further reported that the company intends to keep a presence in Asia while expanding its European operations.
Key takeaways
- Bloomberg reports FalconX has reduced roughly 10% of staff as the firm anticipates a longer-than-expected crypto market slump.
- FalconX is reportedly pivoting in Singapore toward crypto derivatives and intends to withdraw its MAS license application.
- The workforce cut affects staff across multiple markets, after FalconX previously had around 350 employees in the US, UK, Singapore, and Hong Kong.
- FalconX’s move aligns with broader industry cost reductions seen across exchanges and crypto service providers during the downturn.
- The report highlights a wider sector shift from pure spot trading toward derivatives and tokenized asset products.
Workforce cuts and a broader corporate reset
Bloomberg, citing people familiar with the matter, said FalconX carried out the layoffs as part of preparations for what it described as an extended downturn. Before the reduction, the company employed about 350 people across the United States, the United Kingdom, Singapore, and Hong Kong, according to the report.
Bloomberg also noted that FalconX is reshaping its strategy in Singapore by placing more focus on derivatives-related activity. At the same time, the firm is reportedly preparing to withdraw its license application with MAS, signaling that it expects its Singapore roadmap to change materially rather than waiting for approval.
Cointelegraph reached out to a FalconX spokesperson for comment but did not receive an immediate response.
Singapore licensing changes signal a strategic pivot
The decision to withdraw a licensing application—if confirmed—marks a tangible adjustment to FalconX’s approach in Singapore. Rather than pursuing the planned regulatory pathway, the firm is reportedly moving toward a derivatives-focused business model while maintaining its wider regional footprint.
Bloomberg’s report also suggested that FalconX plans to keep operating in Asia, but with a different emphasis, while expanding in Europe. For investors and counterparties, these kinds of shifts can affect how firms allocate liquidity, structure partnerships, and manage regulatory risk across jurisdictions.
FalconX’s earlier acquisition of 21Shares in November also frames the importance of this period: prime brokerage activity and related capital markets services can be highly sensitive to trading conditions, volatility, and institutional engagement—variables that tend to soften during extended bear-market stretches.
Industry downsizing grows as trading volumes cool
The reported workforce reduction adds FalconX to a broader list of crypto businesses scaling back operations during the market downturn. Bloomberg’s report places the company alongside moves already seen from exchanges and infrastructure providers, including Coinbase, Crypto.com, Luno, Gemini, and BitGo, according to references cited in the original coverage.
While the scale and reasons vary by firm, the pattern is consistent: when spot activity and retail participation weaken, businesses often reduce headcount and reallocate resources toward segments that may hold up better—such as derivatives, institutional services, and tokenized real-world asset products.
Exchanges increasingly lean on derivatives and tokenized products
Pressure on exchanges has been building as Bitcoin and other digital assets retreated from last year’s highs, weighing on trading volumes and retail engagement. Earlier coverage from Cointelegraph cited analysts who believe Bitcoin may not yet have reached a market bottom, implying that the broader industry could face continued headwinds.
At the time of the original reporting, Bitcoin was last trading below $64,000—about 50% under its October peak above $126,000. In such conditions, many platforms appear to be searching for revenue resilience beyond spot trading.
CoinGecko data referenced in the original article suggests that the “crypto TradFi” sector—covering tokenized assets, derivatives, and traditional finance-style products—grew fivefold to $6.6 billion between January 2025 and June 2026. Tokenized stocks and commodities were described as leading contributors to that expansion.
Coinbase’s most recent earnings, as referenced in the original coverage, also underscored how the mix can shift during a downturn. Even though the company missed earnings expectations, it reported that 88% of second-quarter net revenue came from businesses other than spot Bitcoin trading, with derivatives, prediction markets, and tokenized assets playing a more prominent role.
Taken together, these developments point to a central industry tension: spot-driven revenue models can be difficult to sustain in extended drawdowns, while firms with deeper derivatives distribution, tokenization services, or institutional market-making capabilities may have more levers to manage through volatility cycles.
What to watch next is whether FalconX’s reported Singapore licensing withdrawal and derivatives emphasis translate into measurable growth in activity—or whether the company’s European expansion becomes the next major operational focus. For the wider market, the key signal will be how quickly trading ecosystems shift their revenue dependence away from spot as conditions remain uncertain.
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