Cryptocurrency trading platform, Crypto.com, has announced plans to reduce its global workforce by 20%.
The company said the decision was made to be able to “navigate the ongoing economic headwinds and unforeseeable industry events.”
The number of staff constituting the 20% is yet to be ascertained, this will be the second time in less than a year that the company will be laying off workers. Crypto.com took similar action in July last year, which saw the exit of about 250 workers from the company.
Crypto.com’s co-founder and CEO, Kris Marszalek, shared a blog post with the company’s workers on Friday, explaining that the company had positioned itself to weather the crypto winter with the first head cut it had in July last year.
He, however, noted that the collapse of FTX worsened the situation as it damaged trust in the crypto industry.
Factors that informed the layoff: Explaining the events that prompted the decision to have a second round of layoff, Marszalek said:
- “Several factors played into our decision to reduce headcount. While we continue to perform well, growing to more than 70 million users worldwide and maintaining a strong balance sheet, we’ve had to navigate ongoing economic headwinds and unforeseeable industry events.
- “We grew ambitiously at the start of 2022, building on our incredible momentum and aligning with the trajectory of the broader industry. That trajectory changed rapidly with a confluence of negative economic developments.
- “The reductions we made last July positioned us to weather the macro-economic downturn, but it did not account for the recent collapse of FTX, which significantly damaged trust in the industry. It’s for this reason, as we continue to focus on prudent financial management, we made the difficult but necessary decision to make additional reductions to position the company for long-term success.”
The tech industry gloom: After the mass layoffs witnessed by the tech industry in 2022, which saw tech accompanies across the globe sacked almost 200,000 workers, the gloom has continued into 2023. With Crypto.com being the latest, the industry has now recorded 4 mass layoffs just within the first 2 weeks of the year.
- The year started with Salesforce announcing a 10% reduction in its workforce in an exercise that will affect 7,000 staff of the company.
- While the industry was still pondering on the fate of 7,000 tech workers in Salesforce that would lose their jobs, America’s e-commerce giant, Amazon, dropped another bomb with the announcement that it would cut more than 18,000 jobs as a result of uncertainties in the economy.
- Earlier this week, another major crypto trading platform, Coinbase announced plans to reduce its workforce by 950, citing bad market conditions.