Massive Crypto Layoffs Continue in November
- The crypto and fintech worlds were the winners of the 2020 pandemic, but these sectors are struggling to survive and have had to cut down their staff strength.
- Some companies blamed their confidence on the previous good run, which led to “excessive” hiring.
- Global firms such as Twitter and Meta are also considering a reshuffle of their hiring process in a bid to cut costs.
The crypto market has remained difficult for both projects, their users and investors due to the bear market. Investment in some market sectors has seen a remarkable drop, while some projects have suffered low patronage.
Crypto exchanges, which were the busiest and biggest gainers of the bull run, have also been hard hit by the crypto winter. Transaction volumes on some exchanges like Coinbase are far from where they were this time last year. So, some of these platforms trimmed down their staff to cut costs.
While some layoffs occurred between May and August, the trend is far from over. Stripe, a payment processor, announced on November 3rd, via a memo sent by its CEO, Patrick Collison, that it would lay off 14% of its workforce, which is about 1000 employees.
Collison noted that the payment firm overhired as an explanation for the latest job cuts. He also listed other factors such as a massive hiring drive motivated by the global pandemic-driven spike in e-commerce, a period of substantial growth, followed by an economic slump marked by inflation, higher interest rates, and other macroeconomic difficulties.
The memo read,
We overhired for the world we’re in, and it pains us to be unable to deliver the experience that we hoped that those impacted would have at Stripe.
The memo also included a payout scheme for the affected employees. Stripe’s CEO pointed out two areas the company missed, leading to its current decision. He wrote,
We were much too optimistic about the internet economy’s near-term growth in 2022 and 2023 and underestimated both the likelihood and impact of a broader slowdown. We grew operating costs too quickly. Buoyed by the success we’re seeing in some of our new product areas, we allowed coordination costs to grow and operational inefficiencies to seep in.
Stripe released a crypto payout product earlier this year for Twitter creators. The company’s decision to lay off some staff represents the widespread instability in the broader finance market.
Dapper Labs Joins the Trend
Blockchain developer Dapper Labs revealed in a memo on Nov. 2 that it would be laying off 22% of its workforce, or about 130 people. The news was shared by the company’s CEO, Roham Gharegozlou, who claimed that the firm’s growth from 100 to over 600 employees within two years prevented it from being as community-driven and aligned as it ought.
According to him, Dapper Labs has refined and centered its product strategy around a “more sustainable cost structure,” and is laying off staff based on the future needs of the company.
Other November Crypto Layoffs
According to a Bloomberg report published on November 1, Web3 behemoth and venture capital firm, Digital Currency Group (DCG) let off almost 10%, bringing its workforce to 66. A representative for DCG claimed the firm made a series of internal adjustments to prepare for its next phase of expansion, including the “streamlining” of units.
Cryptocurrency exchange BitMEX is also making pullbacks in its workforce in addition to a plan to shift away from spot trading and custody services. The platform now intends to focus on crypto derivatives.
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