Bear market: Some cryptocurrencies cut jobs while others strive for sustainable growth

Bear market: Some cryptocurrencies cut jobs while others strive for sustainable growth – Mail Bonus

To put things in perspective, since November 2021, the total market value of the digital asset industry has plummeted from a historic high of $ 3 trillion to approx. 1.27 trillion US dollars and thus shows a loss rate that is over 55%.

Although this sharp decline in monetary policy can be attributed to a number of factors, including the current war between Russia and Ukraine, rising inflation figures and deteriorating macroeconomic conditions have had a major impact on cryptocurrency.

For example, earlier this month, Gemini, a cryptocurrency exchange controlled by the Winklevoss twins, announced that the bear market had forced them to lay off nearly 10% of their employees. The brothers pointed out that as part of their first major staff reduction, Gemini needed to shift its focus to products that are “important” to the company’s long-term vision and goals. In fact, the brothers acknowledged that the current turmoil was likely to continue for at least a few months, adding:

There is no denying the fact that the cryptocurrency industry has grown from strength to strength over the last two years. However, the last six months have been anything but gratifying for the market.

“This is where we are right now, in a phase of recession that is coming to a standstill – what our industry refers to as an ‘encryption winter.’ […] This has all added to the current macroeconomic and regional unrest. We are not alone. “

How bad is the situation really?

In addition to Gemini, a number of other large companies have had to make significant cuts in recent months. For example, the second largest cryptocurrency exchange in Latin America, Bitso, announced late last month that it was firing 80 employees due to deteriorating global economic conditions. At the time of publication, Bitso had over 700 full-time employees.

Auditing the company’s employees is not only a way to tighten the wallet but also a way to reorganize Bitso’s daily operations. That said, a representative of the stock exchange recently revealed that they still have vacancies in strategic areas such as accounting, taxes, fraud detection and more.

Buenbit, one of Argentina’s leading crypto-currency investment systems, had to take more drastic measures to stop its financial bleeding. In the last week of May, the company laid off about 45% of its workforce and reduced the active workforce from about 180 to just 100.

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2TM, the parent company behind Mercado Bitcoin, also revealed that it was planning to lay off 12% of its 750-member team due to “changes in the global financial landscape”. At the time of printing, Mercado Bitcoin is by far the largest cryptocurrency exchange in South America in terms of total trading volume. As part of a statement on the transfer, a spokesman for 2TM said:

“The scenario requires adjustments that go beyond the reduction of operating costs, which also makes it necessary to lay off some of our employees.

Coinbase recently announced that it would slow down recruitment rates and reassess its budget to ensure the company’s continued success. The company even withdrew many job offers it had already issued, jeopardizing the visas of many international applicants. Do not address the issue of visas directly, Coinbase CEO LJ Brock wrote in a recent blog post:

“As these discussions have developed, it has become clear that we need to take stricter measures to slow down the number of employees. Adapting quickly and responding now will help us navigate successfully in this macroeconomic environment and emerge even stronger, enabling further healthy growth and innovation. “

Robinhood’s crypto-friendly trading platform fired 9% of its workforce in April, a decision that came at a time when the company’s stock offerings had peaked from the start. Finally, one of the most prominent ecosystems for cryptocurrencies in the Middle East, Rain Financial, said it had more than 12 employees earlier this month, citing an international financial crisis as the reason for the same.

Repetition from 2018

The aforementioned employment turmoil seems to have a scary tone, reflecting the events of 2018 when the market was facing widespread redundancies across the board. At the time, crypto-mining giant Bitmain released a large portion of its workforce, with reports suggesting that the company had released 1,700 of its 3,200 employees – including the entire Bitcoin Cash (BCH) development team, several engineers, media executives and more.

Migrant motherphoto of Dorothea Lange1936. The film was a symbol of the labor struggle during the Great Depression.

Huobi’s significant cryptocurrency swap also saw massive redundancies in 2018, with the company simultaneously letting go of its “expulsion staff” and stressing that remedial action was needed to sustain its “core business”. At that time, the company reportedly had over a thousand employees.

Finally, the blockchain software technology company ConsenSys was also forced to make significant cuts in 2018, as the company’s CEO, Joseph Lubin, wrote a letter to his employees stating that he would have to lay off about 600 employees in an effort to help the company stay afloat. float. .

Not everything is lost

Within these unfavorable market conditions, there are still companies that have decided not to lay off their employees. For example, the FTX cryptocurrency exchange platform announced that it will not only retain existing employees but also hire new staff as the cryptocurrency winter approaches.

As part of a recent Twitter exchange, CEO Sam Bankman-Fried explained that his company will continue to expand its operations because its growth plan has been well structured, unlike some other companies that experienced unreasonable, unsustainable “overgrowth” last year.

Bankman-Fried criticized “overgrown companies” and said that hiring more staff quickly did not necessarily lead to a significant increase in productivity, as rapid expansion, more often than not, makes it harder for everyone to be on the same page. “Sometimes, the more you control, the less you will do,” he said.

Even though FTX had slowed down its hiring earlier in the year, he said the move was not due to a lack of funds but rather a way to ensure that new team members had enough time to adjust to their new roles and professional environment. .

Some crypto recruiters noted that while the digital asset industry has certainly seen redundancies, its recruitment rate has remained remarkably high, especially compared to traditional technology. To date, a number of giants in Silicon Valley, including Twitter, Uber and Amazon, have announced major job cuts recently.

Netflix also laid off 150 employees after posting historically poor growth figures, but Facebook’s parent company, Meta, pointed out that it was imposing a layoff for all middle-to-senior positions after failing to meet revenue targets.

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Neil Dundon, founder of the employment agency Crypto Recruit, said that things have not shrunk when it comes to hiring in the digital asset industry. “We have a global-based team in the United States, Asia / Pacific and Europe and the demand is as high in the region,” he said in a recent interview with the Cointelegraph.

Similarly, Kevin Gibson, founder of Proof of Search, told the Cointelegraph that the layoffs in the tech industry have had little or no impact on the cryptocurrency industry’s clients to date, adding:

“I have only heard of two companies that have let people go. This could change next month, but slack will be immediately taken up by well-funded quality projects. As a candidate, you will not notice any difference. if you lose your job, you also get a lot of offers pretty quickly. “

Therefore, as the continuing downturn continues to have a major impact on the world economy, it will be interesting to see how companies operating within this space can withstand significant pressure and survive a continuing financial crisis.