CRYPTO PRICE DOWNTURN LET TO GROWING NUMBER OF LAY OFF AT CRYPTO FIRMS
The crypto exchange led by Winklevoss and the keeper of Gemini was one of the latest to announce job cuts for about 10% of its employees, citing "volatile market conditions that are likely to continue for a long time." Shortly afterwards, the Middle East crypto exchange Rain Financial claimed a reduction in the number of jobs due to the difficult market.
Despite the news, US-based crypto currency trading company, Coinbase Global (COIN), reiterated on Thursday that it would extend its previously announced hiring period and withdraw promises of approved jobs as part of a cost-cutting plan in the face of difficulties. market conditions.
"The recent market turmoil and subsequent downturn will continue this summer," predicted Masha Boone, vice-president of the Rarible token (NFT) exchange. "However, it is important to recognize this as an opportunity for reflection. Needed in the crypto space and rethink where the industry is headed from here."
For his part, Boone told CoinDesk that Rarible uses chaos as an opportunity to strengthen internal and product development teams.
The exchange has hit hard
The downturn in Cryptocurrency is in line with public stock markets, with rising interest rates designed to reduce inflation which is detrimental to investors in high technology and growth budgets. Crypto trading that is likely to rely on retailers during a period of excessive investment in the system has seen a significant decline in trading.
As a result, crypto exchanges have been among the fastest to cut transactions in the current environment. In addition to Gemini and Coinbase's move, Argentina's Buenbit crypto exchange has recently laid off 45% of its staff, Latin American crypto exchange Bitso has cut off 80 employees besides its 700+ employees and a Brazilian trading company. Mercado Bitcoin laid off more than 80 employees.
"It is natural that trade, which currently sees low prices, is declining," said George Sutton, an equity analyst with research firm Craig Hallum. “The beauty of this industry is that there are a lot of disruptive models in digital currency and blockchain space so we can enjoy hiring any talent available. We view the decline in volume as a temporary thing, ”Sutton told CoinDesk in an email.
Going forward, crypto companies with legitimate utility bills and services are the ones that will survive, according to Nicholas Strange, founder of Seattle-based rental company Crypto Talent. Many crypto firms have gone through a recession and are better at managing their assets, Strange told CoinDesk. In addition, quarter-over-quarter venture capital funding remains high, and some VC firms can use this decline to continue funding promising crypto-related projects, Strange said.
Crypto companies raised a record $ 30 billion venture capital last year, and the number of deals in the sector remains high despite the recent collapse of cryptocurrency markets, Morgan Stanley told customers in a recent letter. However, contract work is likely to decline in the future, says the investment bank.