The market’s recent bloodbath has resulted in major crypto firms reining in their expansion plans and, in some cases, laying off a sizable portion of their workforce.
BlockFi has laid off 20% of its workforce, while Crypto.com has cut 5%. And now Coinbase will sack 18% of staff, around 1,100 jobs, amid fears of an incoming “crypto winter.”
Brian Armstrong, Coinbase’s chief executive and co-founder, said that he admitted the company had grown too quickly and was to blame for at least some of its problems.
Armstrong said that the decision had been taken because staff grew by more than four times in the last 18 months, and now the company cannot afford them. He also said that the company had grown so quickly that new staff actually made the company less efficient, because they could not be effectively integrated into the team.
Bitcoin’s drop to $22,000 – along with the rest of the market’s crash – has dealt a huge blow to the growth and expansion plans of crypto platforms. The market cap is now at $990 billion, and this has led to some tough decisions on the part of crypto companies.
Gemini exchange also announced earlier that it would cut 10% of its staff, while Coinbase said that it would rescind job offers and suspend hiring. The latter especially had been working aggressively to expand, but the crypto winter has put an abrupt halt to that.
Not all firms gloomy
However, Binance CEO Changpeng Zhao has said that this crypto winter is the best time to hire and strategize future plans. He remains firmly unfazed in the deep losses and that Binance itself would be expanding its hirings now.
All those companies still believe that the crypto market has a bright future, but have to take the reality into account. Binance does appear to be the exception, using its “healthy war chest” to finance the expansion.
Multiple events roils market
The market crash has sent investors and companies scrambling. While it appeared to have been holding out for a while earlier in the week, the last 24 hours saw an even bigger drop.
Other notorious incidents in recent times have also done much to shake investors’ confidence. The crash of LUNA and its UST stablecoin sent shockwaves throughout the crypto market, as well as the wider world. It caught the attention of lawmakers, who are adamant about regulating the stablecoin space.
Celsius Network also announced that it would suspend all withdrawals until further notice. Analysts have been saying that it lacks liquid funds to process withdrawals, though the company’s CEO has denied any problems at the company. Nexo has made an offer to acquire certain assets of Celsius Network.
BeInCrypto has reached out to company or individual involved in the story to get an official statement about the recent developments, but it has yet to hear back.