What goes up must come down, as goes the old saying.
So, crypto prices soared, crypto prices crashed, staffing levels grew and now, staffing levels are being trimmed – and, in some cases, cut to the bone.
The Wall Street Journal reports that cryptocurrency firms are laying off employees, a survival tactic in a world where crypto prices have crashed in some instances by more than 85 percent.
The anecdotes abound. The WSJ noted that Steemit, which offers a blockchain-based social network, has laid off 70 percent of its staff and has pointed to the selloff in digital currencies as a culprit. Similarly, the blockchain venture firm ConsenSys has announced that it will lay off 13 percent of its own roster. In that instance, the venture firm has yet to turn a profit, and the investments/firms that it funded were not even expected to gain traction on top lines, let alone find their way toward showing black ink on the operating line.
In terms of (somewhat) anecdotal evidence supporting the quick about-face on careers in crypto, the number of searches across job site Indeed.co was down 3 percent in the 12 months leading into October. That comes as a similar reading was up more than 480 percent in the previous year period.
“The number of employers listing blockchain-related jobs is still rising, but at a much lower rate,” said the report. This speaks to a bit of a wait-and-see attitude, perhaps, where once job seekers took an enthusiastic approach to leaping into the great unknown.
The key, one source – whose company had been paid in cryptos – told The WSJ, is to get revenue-generating applications out on the market. “I think what’s going to turn this around is real products actually touching people,” he said.
Perhaps easier said than done, because innovation needs development – and development needs cash.
The debris also litters the ICO field, as the financial publication stated that many of the companies that raised funds amid these coin offerings have shuttered.
We pointed to this a bit over the summer, when research from Boston College showed that out of 4,000 ICOs, half of them failed, disappeared and shut their doors within four months after the token sales were completed.
“Breaking it down by category, 83 percent of the 694 ICOs that don’t report capital and don’t list on an exchange are inactive after 120 days. For the 420 ICOs that raise some capital but don’t list, this figure falls to 52 percent, and for the 440 ICOs that list on an exchange, only 16 percent are inactive in the fifth month,” said a paper from the college.
This time around, the past year has decimated the market cap of cryptos to $111 billion, down from a recent $827 billion peak. The ICOs that were offered? Roughly 86 percent are trading below their initial listing prices.