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As the crypto market and related businesses suffer, some of the industry’s biggest players are now announcing job cuts. BlockFi – a popular crypto lending platform – has confirmed that it will be cutting its headcount by as much as 20%.
Crypto Companies Start Downsizing
In a Twitter thread posted by BlockFi’s CEO on Monday, Zac Prince clarified that the layoffs will not impact customer experience or funds. However, he expressed deep regret about the decision, saying it had not been made lightly.
“Today is a painful day for BlockFi but more so for employees who we have to part ways with,” he said.
Prince explained that the company had been forced into this position due to macroeconomic conditions. As the Federal Reserve continues to tighten interest rates, crypto and stocks have been damaged badly – as with crypto companies.
Alongside decreasing its headcount, BlockFi has also been eliminating non-critical vendors, reducing marketing, and reducing executive compensation. The layoffs will reduce BlockFi’s employee count from 850 to just 650.
The lending platform isn’t the only company under pressure. Crypto exchange Crypto.Com has also announced a 5% headcount reduction on Friday. Rival exchange Gemini announced similar plans for a 10% cut earlier this month.
Robinhood, too, has been forced to downsize, announcing in April that it had fired 9% of full-time employees. Even Coinbase, which was on a mass hiring campaign this year, has rescinded its previous offers to some prospective employees.
The only exchange that appears to be hiring amid the chaos is Binance – the world’s largest crypto exchange. Binance CEO Changpeng Zhao claims to have a “war chest,” and sees the bear market as an excellent opportunity to acquire talent.
Crypto Companies Collapse
The crypto market experienced immense growth in 2021, but Bitcoin’s price has now returned to its lows from December 2020. Besides macro uncertainty, the industry is still reeling from the collapse of the former third-largest stablecoin and its Anchor protocol.
Earlier today, crypto lending platform Celsius halted all customer withdrawals of crypto under immense pressure. Its fall coincided with a 50% collapse in CEL within the past week, and arguably contributed to today’s market meltdown. Blockchain data revealed yesterday that the company sent $320 million in crypto to FTX exchange.
The platform claims its actions are in the interests of its community. However, it has not specified for how long its withdrawal prevention will last.