Max Levchin, Chief Executive Officer of Affirm, has confirmed the rumors that the business will be winding down its "Affirm Crypto Program." This happens due to decreased consumer expenditure and changing macroeconomic ecology.
On February 8th, the Chief Executive Officer of the buy-now-pay-later corporation distributed (1) a letter to the investors and news of a nineteen percent employment reduction.
He added that the unusual macroeconomic position and the necessity to adjust for a few liabilities on the company's balance sheet were the two major reasons for the initiative. He said this was because the macroeconomic scenario had never happened before.
The statement indicated that the corporation was placing a greater emphasis on its core operations while also slowing down the pace of initiatives with less definite revenue timelines.
Consequently, the company has decided not only to cut the number of employees working for the organization but also to discontinue several programs, one of which is Affirm Crypto.
Michael Linford, the company's chief financial officer, spoke on why the choice was made so that the company might achieve profitability in the future. Linford indicated that the actions were implemented to reduce the costs of the operation.
The business organization concluded that the cost base had been approximately scaled to achieve the estimated levels of profitability while simultaneously pushing the product portfolio and the growth strategy.
Affirm is a payments service provider targeted toward millennials and is analogous to Afterpay in that it enables customers to buy a commodity online and pay for it later. Late in 2021, close to the height of the crypto currency market, the business launched what it called the "Affirm Crypto Program."
Working in conjunction with the Bitcoin payments platform NYDIG, it enabled Affirm customers to open crypto currency accounts and process Bitcoin transactions.
Users could devise a system that would automatically convert the monthly interest accrued from a customer's savings account into Bitcoin thanks to the help of a program that was important in making this possible.
The crypto currency initiative will be terminated at the end of March as planned. The website for Affirm indicates that as of March 2nd, users will no longer be able to purchase bitcoin using the Affirm app.
The message further said that any bitcoins found in the customer's account would be sold at the CME CF Bitcoin Reference Rate (BRR), and the proceeds from the sales transactions would be put into the customer's Affirm Savings account.
The crackdown is a direct result of a tendency that has become more widespread in the crypto currency space: a reduction in the staff. According to Levchin, nineteen percent of the company's workforce has been requested to resign immediately.
Levchin blamed himself, in a message published on February 8th, for the decline in the company's profitability since he claimed to have reacted slowly to the actions made by the US Federal Reserve. Affirm now employs over 2500 individuals. Due to the staff reduction, more than 500 individuals will be out of work today.