Cryptocurrencies and the stock market were hammered by deteriorating economic conditions so far this year, between a potentially looming recession, sky-high inflation and a Federal Reserve poised to further cool the economy by raising interest rates.
The deteriorating economic outlook has prompted companies to reduce hiring or downsize operations to better manage costs and protect profits. Earlier in June, Tesla CEO Elon Musk said in an email to company executives that he had a “super bad feeling” about the economy, stating that 10% of the company’s employees were about to lose their jobs reporting from Reuters.
The sense of pessimism has prompted similar cuts from companies in the crypto world, but not all, as some are currently hiring and celebrating amid the carnage.
Gemini Trust Co., owned by billionaires Tyler and Cameron Winklevoss, was among the first crypto titans to announce they were laying off employees. On June 2, the company announced in a blog entry it would cut about 10% of its workforce, citing “turbulent market conditions that are likely to persist for some time.”
Coinbase, on the other hand announced a hiring freeze in which job offers were withdrawn from employees with whom agreements had already been made. The company would later indicate need Laying off 1,100 of its employees and preparing for an “extended” crypto winter by cutting its workforce by 18% for “over-recruiting” during the previous crypto markets bull run.
BlockFi CEO Zac Prince explained The company, which offers high-yield crypto accounts to its customers, would “cut down [its] Headcount by about 20%” to about 600 on June 13, saying the “decision was driven by market conditions that have negatively impacted our growth rate and a rigorous review of our strategic priorities.”
Krypto.com announced It would lay off 5% of its company, or 260 employees, to “ensure continued and sustainable growth over the long term,” according to CEO Kris Marszalek said in a tweet on June 10th. He added, “We will continue to evaluate how best to optimize our resources to position ourselves as the strongest builders during the down cycle and become the biggest winners in the next bull run.”
Over the past six months, Crypto.com has paid an estimated $1.4 billion to become a FIFA World Cup sponsor and put its name on the former Staples Center in Los Angeles, along with an additional $100 million for Matt Damon to star in Crypto.com’s Super Bowl commercial earlier this year with the remarkable declaration “Fortune favors the brave.”
2TM, the company that created Mercado Bitcoin, has a expression said it would lay off 12% of its 750 workers that same week. The company, which operates the second-largest cryptocurrency exchange in Latin America by volume, according to data from CoinGecko, based the decision on “changes in the global financial landscape” that required it to go beyond simply reducing operating expenses.
Bisto, the largest cryptocurrency exchange in Latin America by volume, made the announcement Cut 80 of its 700 employees the week before amid an improving economy. The company was founded in 2014 and operates in the USA, Colombia, Mexico, Brazil and Argentina. The exchange hosts 34 tradable currencies and claims to be the largest in Mexico.
Buenbit, a leading cryptocurrency exchange in Argentina, also said it was laying off 45% of its workforce around the same time, reducing headcount from 180 to 100. CEO Federico Ogue said in a Twitter thread“After a 2021 of exponential growth for the technology industry, we find ourselves in a global review phase.”
Who is hiring?
While dynamics in markets are dragging down some companies with a hiring hangover, others are expanding and potentially hiring talent that their competitors are losing.
FTX has no plans to stop hiring new employees, Sam Bankman-Fried, the company’s CEO, said on June 6. The second largest crypto exchange by volume behind Binance, according to data from CoinMarketCapemploys around 250 people.
“We’re going to keep pushing forward,” Bankman-Fried said in one Twitter thread. “Because we hired carefully, we can continue to grow regardless of market conditions.”
Kraken said they have no intention of making layoffs and see the current market downturn as “time to build,” the company said in a blog entry on 15th of June. It says it hasn’t adjusted its hiring plans and has 500 jobs to fill for the rest of this year.
In the statement, the company emphasized that it is not guided by “short-term opportunities to maximize profits” and has learned from experience with previous cycles, founded back in 2011, how to navigate difficult times.
Binance CEO Changpeng Zhao said Binance is building itself while its competitors are trying to downsize and announced that the company will hire 2000 employees on the same day. Kraken also revealed an urge to hire more.
“It wasn’t easy saying no to Super Bowl advertising,” said the CEO said in a tweetmeaning it wouldn’t have been in the company’s best interest to champion potential visibility.
“If we’re in a crypto winter, we’re going to leverage that, we’re going to leverage that to the maximum,” Changpeng Zhao is reported to have said wealthat the Consensus 2022 conference in Austin, Texas, adding that Binance has a “healthy war chest.”
Open sea announced It puts “general” at the bottom of a blog post on its website on June 14 that reveals details about the release of its new Seaport, a Web3 protocol designed to make it easier to buy and sell NFTs.
Everstake, a Ukraine-based Web3 company, provides clients with high-yield accounts for staked cryptocurrency and “continues to grow its team” by adding 30 employees since the Russian invasion of Ukraine, said Vlad Likhuta, the company’s head of growth decrypt in an e-mail, also on 14.
Polygon, the company known for and enabling its eponymous sidechain network daps Building scalably on top of Ethereum is also growing, according to CEO Ryan Watt said in a tweet on June 15 and said the company is aiming to increase its workforce by around 15% by the end of this year.
On the same day, Polygon’s Head of Remote, Tyler Sellhorn, tweeted to people who know people who have been fired from Coinbase and other Web3 companies to apply to Polygon and posted a link to the company’s job page in a subsequent tweet.
Where from here?
Until the cryptocurrency markets reverse course, more companies could announce layoffs or even shut down altogether, and the downtrend in the prices of most digital assets could be exacerbated by a declining stock market or further economic turmoil.
However, some companies will seize the opportunity and try to position themselves in hopes of benefiting from the market recovery whenever that may be the case.
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