Kraken’s Sudden Exit from Abu Dhabi: What’s Behind the Early Departure?

Kraken Closes Its Abu Dhabi Office

In the latest twist in the crypto saga, Kraken has swung the proverbial door shut on its Abu Dhabi office less than a year after scoring regulatory approval to operate in the region. Bloomberg broke the news on February 2, revealing that the exchange has laid off about eight staff members from their MENA-focused team. Talk about a fly-by visit, right?

Timeline of Events: From Approval to Closure

In April 2022, Kraken was given a thumbs up to provide services within the Abu Dhabi international financial center and Abu Dhabi Global Market. Unfortunately, all that glitter wasn’t gold as the crypto market hit a rough patch that has plagued many firms since then. The impending doom left Kraken no choice but to reevaluate their presence in the Middle East.

Reasons for Shutting Down

According to a statement from a Kraken spokesperson, the decision to close the Abu Dhabi office stemmed from a review of their “business lines.” This may sound like corporate jargon, but it ultimately points to a shift in focus likely driven by financial pressures. Kraken will still allow regional users to access its platform with other fiat currencies—a silver lining for those left hanging.

Layoffs and Workforce Reduction

You might have heard the phrase “when it rains, it pours.” This couldn’t be more applicable as Kraken has been slashing its workforce in response to the crypto winter. Back in November, the firm announced a staggering 30% cut—over 1,000 employees—aimed at making the company leaner and meaner. Co-founder Jesse Powell likened this to taking the company back to its 2021 size, yanking back the clock on their rapid expansion.

The Fallout: More Changes on the Horizon

The MENA managing director, Benjamin Ampen, may also be packing his bags as part of this transitional phase. Kraken’s troubles don’t stop at Abu Dhabi; they recently pulled out of Japan as well. This marks a second exit since 2018, with executives citing unfavorable market conditions as a primary reason. Are fewer countries too much for Kraken to juggle?

Conclusion: What’s Next for Kraken?

As Kraken attempts to navigate the choppy waters of the crypto market, only time will tell what lies ahead for the notorious exchange. Will they bounce back from this setback or are more office closures on the near horizon? It seems the crypto roller coaster ride is far from over!