Famous cryptocurrency exchange crypto.com announced the first round of layoff in 2023.
Crypto.com reduced the headcount of its staff member by 20%. The company is yet to publically announce the reason for taking such action. However, many believe that the existing bear market has put financial stress on the company thus forcing it to take such action.
It is not the first time the company has laid off employees in the bear market. Last year, Crypto.com has announced downsizing its staff by 5%. However, the report suggested that the platform has actually laid off 30%-40% of the workforce.
The exchange has over 70 million users trading and staking crypto assets on the platform. It roped in Hollywood actor Matt Damon to promote cryptocurrency in the famous “Fortune favours the Brave” advert.
During the bull run, the exchange has spent the most money on branding and marketing efforts including $700 million for rebranding a stadium to crypto.com Arena.
After FTX collapsed, the crypto community speculated about the fall of crypto.com in the bear market but Kris Marszalek, the founder & CEO of the company assured that the company is financially strong.
The exchange now joins Coinbase, Genesis, Huobi and Silvergate in firing employees at the beginning of the year. It started with Genesis, the crypto lending protocol that laid off 30% of its staff, followed by Silvergate (40%), Coinbase (20%) & Huobi (20%)
Recently, Blockchain.com, the cryptocurrency brokerage firm also reduced its headcount by 28% after it fired 110 employees. The 2023 layoffs confirm the continuation of crypto winters and the economical stress the exchanges are facing.
Coinbase exchange covered the layoff by calling it a part of its restructuring plan. However, the news came after it was ordered to pay $50 million fine to NewYork regulators to settle background check charges.
Digital Currency Group (DCG) owned Genesis is also on the same boat after it froze withdrawals and failed to return $900 million to Gemini. It’s highly anticipated that Genesis may file for bankruptcy in 2023 if the crypto winters continue for another 6 months.
The bear market isn’t the only thing worrying the crypto exchanges. The regulators are pushing to impose strict crypto regulations, making it impossible for crypto platforms to operate in an already panicked environment.
2023 hasn’t started well for the crypto industry which now stands at $860 billion marketcap. Everyone is waiting for the return of the bull market and clear regulations. Until then, it’s a wait-and-watch game.
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Paras is a blockchain writer & video creator at Katoch Tubes. In his free time, he loves watching space exploration documentaries & Hollywood movies.