After observing record highs in 2021, the cryptocurrencies went through a major crisis in 2022. During this period, the values of crypts such as the bitcoins And Ethereum has collapsed, many companies have been fired and some have even filed for bankruptcy. Crypto.com was one of those companies that had to downsize last year. In June, it laid off 5% of its workforceor nearly 260 employees.
Unfortunately the situation continued to deteriorate. And this week, Crypto.com is announcing even more scaling. In fact, it is 20% of this company’s employees who will be fired. According to estimates transmitted by CoinDesk, between 700 and 900 employees could leave the company.
A company that would show good performance
In a message to Crypto.com employees, CEO Kris Marszalek explains that the company has done well. This evokes a growth that has made it possible to accumulate 70 million users worldwide, as well as a “solid balance sheet”. However, the layoffs are being justified by “continuing economic headwinds and unpredictable industry events.”
Like many cryptocurrency and tech companies in general, Crypto.com hired too much after its 2021 performance. However, with the sharp changes of 2022, it had to lay off. According to Marszalek’s explanations, the layoffs announced in June 2022 were supposed to allow Crypto.com to weather the crisis.
However, when it decided to part ways with 5% of its workforce, the company hadn’t anticipated it the fall of FTX which, according to the CEO of Crypto.com, “has greatly shaken confidence in the industry”. “It is for this reason that, while we continue to focus on prudent financial management, we have made the difficult but necessary decision to make further reductions to position the business for long-term success.”Adds.
Note that, like Crypto.com, the American market leader Coinbase also has announcement further downsizing in January. In 2022, due to the cryptocurrency crisis, it had already laid off 1,100 employees, or 18% of its workforce. But that wasn’t enough and a few days ago it announced a further 20% reduction in the workforce, or 950 employees. The layoffs are part of a 25% reduction in business costs.
To justify this decision, the company evokes uncertainty for 2023. “As we looked at our 2023 scenarios, it became clear that we needed to cut expenses to increase our chances of success in each scenario. While it is always painful to be separated from our colleagues, it has not been possible to reduce our expenses sufficiently without taking into account changes in the workforce”Coinbase chief Brian Armstrong explained in a message to employees.
Today we announced the difficult decision to reduce our global workforce by approximately 20%.
—Chris | Crypto.com (@kris) January 13, 2023