Bear market: Some crypto firms cut jobs while others aim for sustainable growth

To put things into perspective, since November 2021, the total market capitalization of the digital asset industry has plummeted from it’s all-time high of $3 trillion to its current levels of approx. $1.27 trillion, thus showcasing a loss ratio of over 55%.

While this massive monetary downturn can be attributed to a range of factors, including the ongoing Russia-Ukraine war, rising inflation figures and worsening macroeconomic conditions have had a major impact on the crypto job landscape.

For example, earlier this month, Gemini, a cryptocurrency exchange helmed by the Winklevoss twins, announced that the bear market had forced them to lay off nearly 10% of its employees. The brothers noted that as part of their first major headcount cut, Gemini had to shift its focus on products that are “critical” to the firm’s long-term vision and goals. In fact, the brothers conceded that the existing turbulence was likely to persist for a few months at the very least, adding:

There is no denying the fact that the crypto industry has grown from strength to strength over the last couple of years. However, the last six odd months have been anything but pleasant for the market. 

“This is where we are now, in the contraction phase that is settling into a period of stasis — what our industry refers to as ‘crypto winter.’ […] This has all been further compounded by the current macroeconomic and geopolitical turmoil. We are not alone.”

How bad is the situation really?

In addition to Gemini, a number of other big-name firms have had to make serious cutbacks in recent months. For example, the second-largest cryptocurrency exchange in Latin America, Bitso, announced late last month that it was letting go of 80 of its employees due to worsening global economic conditions. At the time of the announcement, Bitso had over 700 full-time workers. 

The firm’s staff overhaul is not only a means of tightening its purse strings but also as a way of restructuring Bitso’s day-to-day activities. That said, a representative for the exchange recently revealed that they still have few vacancies across niche strategic domains such as accounting, tax, fraud detection and others.

Buenbit, one of Argentina’s leading cryptocurrency investment platforms, had to take more drastic measures to put a stop to its financial bleeding. During the last week of May, the company laid off approximately 45% of its workforce, shrinking its active employee pool from about 180 to just 100 workers.

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2TM, the parent company behind Mercado Bitcoin, also revealed that it was going to be laying off 12% of its 750-strong team as a result of “changes in the global financial landscape.” At press time, Mercado Bitcoin is by far the biggest crypto exchange in Latin America in terms of the total trading volume. As part of a statement regarding the move, a spokesperson for 2TM noted:

“The scenario requires adjustments that go beyond the reduction of operating expenses, making it necessary also to lay off part of our employees.”

Coinbase announced recently that it would slow down its rate of hiring and reassess its financial strategies so as to ensure the company’s continued success. The firm even rescinded a lot of job offers that it had already issued, putting the visas of many international candidates in jeopardy. Not addressing the visa issue directly, Coinbase’s chief people officer L.J. Brock wrote in a blog recently:

“As these discussions have evolved, it’s become evident that we need to take more stringent measures to slow our headcount growth. Adapting quickly and acting now will help us to successfully navigate this macro environment and emerge even stronger, enabling further healthy growth and innovation.”

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