Bitwise Trims Staff by 14% Amid 31% Drop in Key Fund's Assets

Bitwise Asset Management reduced its global headcount to 155 employees last week, a 14% reduction driven by a prolonged downturn in digital asset prices. The job cuts coincide with a 31% decline in the net assets of the firm’s flagship Bitwise 10 Crypto Index Fund (BITW) through the first seven months of 2026. Because crypto asset managers typically generate revenue through management fees calculated as a percentage of assets under management, a drawdown of this magnitude directly compresses fee income and necessitates proportional cuts to operating expenses.

Chief Executive Hunter Horsley framed the reductions as a structural realignment rather than a distressed retreat. "This equips us well for the ongoing growth we've seen this year and expect to continue as crypto further integrates into the global economy," Horsley said. The firm is actively attempting to balance this cost discipline with strategic expansion, evidenced by its February acquisition of institutional staking provider Chorus One to broaden its service offerings.

Bitwise is the latest in a string of crypto companies shrinking their payrolls as the sector confronts depressed market conditions and a broader technological shift toward artificial intelligence. In May, Nasdaq-listed exchange Coinbase reduced its workforce by 14% specifically to facilitate a transition toward AI-native operations. Custodian BitGo eliminated 15% of its staff in June citing ecosystem changes, while Polygon Labs initiated its second round of layoffs last month as it integrates Coinme and pivots to a payments-focused model.

Despite the operational contraction across the industry, Bitwise's leadership projects an imminent market reversal. Chief Investment Officer Matt Hougan told Bloomberg on Tuesday that bitcoin's resilience against negative catalysts—including the delayed Clarity Act and continuous selling by Strategy—suggests the bear market may have already bottomed out. He further argued that large wealth management platforms will act as the "quiet catalyst" driving the next bull market.

The stark contrast between shrinking corporate headcounts and optimistic executive forecasts underscores a defining tension for crypto investors. Management teams are aggressively cutting operational capacity to survive a brutal first half of 2026, yet they remain heavily leveraged to a theoretical institutional recovery that has not yet materialized in asset prices.