Crypto companies are once again tightening their belts, as the bear market enters the second year and the industry suffers from major meltdowns that damage its outlook.
(Bloomberg) — Crypto companies are once again tightening their belts, as the bear market enters the second year and the industry suffers from major meltdowns that damage its outlook.
Coinbase Global Inc., Blockchain.com, Genesis and Crypto.com are among companies embarking on a new round of layoffs. The four firms, along with exchange Huobi, crypto bank Silvergate Capital Corp. and Ethereum software firm ConsenSys, collectively are shedding thousands of jobs in the first two weeks of 2023 — with a tally of more than 1,600 lost even before Crypto.com.
In a letter to employees, Coinbase Chief Executive Officer Brian Armstrong said the industry could see further contagion, and that “in hindsight,” he should have cut deeper last year. Crypto.com co-founder Kris Marszalek in a statement Friday cited the collapse of FTX as damaging trust in crypto.
The digital-asset sector has already downsized from its boom time in 2021, when upstarts poached talent en masse from Silicon Valley and Wall Street firms. Within a year, some of the biggest participants — FTX, BlockFi, Celsius Network — went bankrupt and others scaled back ambitions to survive.
The new round of dismissals came as a possible US recession looms, leading to job cuts across industries. Tech and financial titans such as Amazon.com Inc., Goldman Sachs Group Inc. and BlackRock Inc. are also conducting widespread layoffs, citing economic uncertainty in a higher interest rate environment.
Further upheavals could come as crypto brokerage Genesis and its parent firm Digital Currency Group seek to resolve their debt woes with Gemini crypto exchange and other creditors.
Here are some of the crypto job cuts in 2023:
Blockchain.com
Crypto platform Blockchain.com is letting go of 28% of its workforce, or about 110 employees, according to a person familiar with the situation. The job cuts followed its reduction of about 150 staff last year. After the layoffs, the company’s headcount will be 280 employees, up from 160 at the beginning of 2021, the person said. The news was first reported by CoinDesk.
Coinbase
On Jan. 10, Coinbase announced a job cut of about 950 employees, or 20% of its workforce. It’s closing most of its operations in Japan and shutting several projects. Last June, Coinbase laid off 18% of its workforce, the equivalent of roughly 1,100 employees, and eliminated another 60 in November.
ConsenSys
Ethereum software company ConsenSys plans to cut off more than 100 employees, CoinDesk reported.
Crypto.com
Crypto.com said it has laid off about 20% of its global workforce. That’s on top of layoffs in the middle of last year. Crypto.com didn’t immediately respond to requests for the specific number of jobs eliminated in the latest round.
Genesis
Crypto brokerage Genesis Global Trading Inc. laid off more than 60 employees, or about 30% of its workforce, on Jan. 5. Last August, the company eliminated 20% of its workforce, while its Chief Executive Officer Michael Moro stepped down.
Huobi
Crypto exchange Huobi is planning to lay off 20% of its workforce, according to a statement earlier this month. The company has about 1,100 employees.
Silvergate Capital
Silvergate Capital Corp. said in January it is reducing headcount by about 200, affecting 40% of its staff. The crypto-friendly bank suffered a run on deposits, prompting it to sell assets at a steep loss.
–With assistance from Olga Kharif and Joanna Ossinger.
(Updates with Crypto.com cuts from the second paragraph.)
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.