Cuts Staff as Crypto Layoff Wave Persists

Cryptocurrency trading platform is reportedly cutting 28% of its workforce.

“The crypto ecosystem is facing significant headwinds as its course corrects from the challenges of the last year,” the company told CoinDesk in an email published Thursday (Jan. 12). “To better balance product offerings with demand, we’ve made the difficult decision to reduce operating costs and headcount to rightsize the company.”

PYMNTS has reached out to for comment but has not received a response.

These job cuts — which impact 110 workers — follow a previous round of layoffs at the company, which let go of 150 workers in June of last year.

Those layoffs happened in the wake of the company’s $270 million loss to Three Arrows Capital, a crypto hedge fund that had an estimated $10 billion in assets and made some extremely risky bets on decentralized finance projects like the Terra/LUNA algorithmic stablecoin.

October saw reports that was considering a “down round” of funding that would have reduced the company’s value from the $14 billion it reached earlier in 2022.

The job cuts at come days after the crypto exchange Coinbase said it was eliminating 20% of its staff as the industry continues to suffer through its long “winter.”

“As we examined our 2023 scenarios, it became clear that we would need to reduce expenses to increase our chances of doing well in every scenario,” Coinbase CEO Brian Armstrong told employees earlier this week as the company carried out its third round of cuts.

“While it is always painful to part ways with our fellow colleagues, there was no way to reduce our expenses significantly enough, without considering changes to headcount.”

Other crypto firms cutting jobs include cryptocurrency lender Genesis — which is reportedly letting go of 30% of its employees and also considering bankruptcy — and the exchange Kraken.

According to CoinDesk, the layoffs leave with 280 workers, having grown from 160 staff members in early 2021. Laid-off employees will receive severance packages.

One outlier in all this is the industry’s largest exchange, Binance, which said this week it plans to increase its staff by 15% to 30% this year after hiring almost 5,000 workers in 2022.

“We will continue to build and hopefully we will ramp up again before the next bull market,” CEO Changpeng Zhao said at an industry conference Wednesday (Jan. 11).