News JVTech Bitcoin: for these giants, the “crypto winter” continues in 2023…
Published on 01/13/2023 at 18:35
While Bitcoin had recovered during the week, the cryptosphere is facing a new turnaround. After a year 2022 in the red due to the fall of cryptos, the giants of the sector must make their first arrangements for the year. And at first glance, this is not good news…
The Coinbase crypto platform lays off massively
After a complicated year 2022, the Coinbase cryptocurrency exchange platform does not start 2023 under the best auspices. In a press release issued last Tuesday, the crypto giant has announced it is parting ways with 950 employees worldwide. This massive layoff represents 20% of the company’s total workforce.
This decision is motivated by the fall of virtual currencies, but not only… Indeed, Coinbase indicated that the rout of certain unscrupulous players had had a significant impact on the health of the company. We understand here that the collapse of the FTX crypto exchange last November generated real collateral damage for other crypto professionals. Since this unfortunate event, hundreds of thousands of users no longer trust the platforms and have withdrawn their cryptocurrencies from them.
Coinbase therefore suffers a double punishment: the fall in the price of cryptos and the actions of its competitors. Also, through this new emergency plan, the listed company plans to drastically reduce its operating expenses for the quarter. She believes spend about 25% less compared to the previous quarter.
This new announcement has an air of deja vu since last June, Coinbase had already laid off 1,100 employees, or about 18% of its total workforce at the time.
And to make matters worse, the situation of this giant is far from isolated…
The Crypto.com platform, which you may have seen as a sponsor during the World Cup in Qatar, has also announced the dismissal of some of its employees.
Crypto.com also plans to part ways with 20% of its workforce, approximately 800 employees. Last June, it also followed Coinbase’s decision by reducing its workforce by 5% (260 people).
The finding is clear, Crypto.com invokes the same reasons as the competition, namely the collapse of FTX. For Kris Marszalek, the co-founder of Crypto.com, this event has “significantly damaged confidence in the sector”.
However, the crypto industry is not alone in this situation. These announcements of massive layoffs seem to be part of a global trend. Since the explosion in the share price of technology companies in 2020, several groups are now facing a downturn. Thus, Meta, Twitter or even Amazon have laid off tens of thousands of employees since the start of 2023.