When CoinDesk released a suspicious balance sheet for Sam Bankman-Fried’s trading company in November 2022, set off a chain of events that would upend every corner of the cryptocurrency industry, including its own.
The resulting bear market hurt the long-standing trade publication’s parent company, Digital Currency Group, leading to layoffs of nearly 50% of CoinDeskThe DCG editorial team put the set up for sale. A media report suggested that DCG, which had bought the publication for just $500,000 in 2016, could make up to $300 million from the sale, but, as with so many things in the world of cryptocurrencies, that figure reflected a wide gulf between aspiration and reality.
In November, DCG completed an all-cash deal with digital asset exchange Bullish. The sale price was in the range of $70 million to $80 million, according to a person familiar with the deal. (The blocka competitor, sold to Singapore-based Foresight Ventures in November 2023 for a valuation of $70 million).
Now, like a slimmed down CoinDesk Entering its new era of ownership, the respected crypto publication hopes to maintain editorial independence while finding stability in a volatile industry. Whether this happens depends on its new owner, whose values are untested and whose business strategy is unclear.
“So far, it’s cautious optimism,” said one CoinDesk employee, who spoke with Fortune on condition of anonymity.
Who is bullish?
The collapse of crypto markets in late 2022 exposed the strain on Digital Currency Group’s relationship with its portfolio release. CoinDesk Not only did he help precipitate DCG’s financial problems, he continued to report on the ensuing lawsuits and bankruptcies that plagued owner Barry Silbert’s empire.
The bulls will inherit the same complicated relationship. Led by former NYSE chairman Tom Farley, Bullish is backed by investors such as Peter Thiel’s Founders Fund, although it lacks the market presence of competitors such as Coinbase and Binance. According to CoinMarketCap, Bullish is the 89th largest exchange by trading volume and is not available to US-based users.
Launched in 2021, Bullish was the latest venture from an ailing crypto company called Block.one. Co-founded and led by a crypto entrepreneur named Brendan Blumer, Block.one created a blockchain called EOS in June 2018, raising over $4 billion (an incredible sum even during the manic era of “initial coin offerings”). ” in the largest-ever offering of its kind.
While Block.one marketed EOS as a competitor to Ethereum, the platform suffered from congestion issues and criticism of centralization. In 2019, the Securities and Exchange Commission ordered Block.one to pay a $24 million fine as part of a settlement for its initial unregistered coin offering, a deal many in the crypto industry viewed as favorable given the subsequent SEC enforcement actions. Today, EOS is the 32nd largest blockchain by total value locked, according to CoinMarketCap.
Bullish represented a new attempt at legitimacy for Block.one, seeding the exchange with liquidity from its EOS proceeds and planning to take the company public through a special purpose acquisition company. Bullish canceled the deal, which had proposed valuing the transaction at $9 billion, in 2022.
Given Bullish’s checkered history, its purchase of CoinDesk raised questions about whether the exchange would honor the publication’s commitment to reporting. In an interview with Wall Street Journal Following the deal, Farley said Bullish was willing to invest “a lot of money” in CoinDesk and that the establishment would operate as an independent subsidiary.
a new leaf
On Thursday, Bullish announced a restructuring of CoinDeskThe leadership team, although he initially stated that he would remain in place. Former CEO Kevin Worth and several other executives were ousted, and Bullish’s former director of business development, Sara Stratoberdha, was named CEO. It will be her first foray into the media after working at financial firms such as Blackstone and Credit Suisse.
“CoinDesk will remain an independent subsidiary of Bullish Group and Sara is committed to maintaining CoinDeskjournalistic independence and integrity”, CoinDesk the spokesperson said in a statement shared with Fortune.
On Friday, Bullish held a public meeting with CoinDesk employees to explain the changes, and Stratoberdha answered questions from both the editorial and business sides of the publication. He CoinDesk A staff member said the restructuring was expected due to the publication’s difficult revenue figures and layoffs last year. “There won’t be many tears shed,” the employee said of the restructuring.
The editorial staff’s main concern is whether Bullish will allow CoinDesk to maintain their independence. The staffer said the retention of key staff, including editor-in-chief Kevin Reynolds, was a positive sign, adding: “Overall, I think it’s probably too early to start putting dirt on our graves yet.”
