Massive layoffs at Exchanges due to market circumstances

Hello dear friends.

The bearish cycle that the cryptocurrency market is currently experiencing is not only affecting small investors, some of the main exchange platforms in the United States and Latin America have announced the layoff of a significant number of workers and changes in their hiring policies and even reduction of operating expenses, in order to adjust to the current macroeconomic situation.

Many companies linked to the cryptocurrency sector have reduced their staff. Source: Pixabay.com.

As we all know, the main cryptocurrencies have already been in the red for several weeks, which has undoubtedly led many investors to experience large losses, and companies linked to the cryptocurrency sector cannot escape this reality either, so the fall in prices and a decrease in activity in cryptocurrency trading have led at least five exchanges to carry out a wave of massive layoffs, as a way to deal with the current financial scenario.

On the one hand, Grupo 2TM, the company that owns Mercado Bitcoin, the Brazilian exchange platform, and the largest in Latin America, announced the layoff of 12% of its 750 employees, to adjust to the current market circumstances, in their official statement they made it known that these circumstances required them to do more than simply reduce operating costs. On the other hand, Vtex, another Brazilian digital commerce platform, announced the layoff of 193 employees, justifying the layoff as an organizational restructuring to adjust to their priorities and the current market cycle.

Other companies such as Bitso, the second exchange platform in Latin America, and the largest in Mexico, announced the dismissal of 10% of its workers in addition to modifying some of its activities, while Buenbit, another important exchange platform in Latin America and the main one in Argentina, had to do the same, but this one has had to be more drastic, and has dismissed 45% of its employees, announcing that they even had to redefine their operations and put on hold their expansion plans, to ensure a self-sustainable structure.

The crisis of the crypto ecosystem also spread to the United States, the Gemini exchange platform was also forced to make a 10% reduction of its staff as a measure to cope with the situation and ensure its long-term operations, so reported Gemini's leaders in their blog, saying that the cryptocurrency revolution is still underway, but its trajectory cannot be described as gradual or predictable, and that we are currently in a period of contraction that the industry calls "cryptowinter", so they asked their team leaders to focus only on mission-critical products and evaluate the size of their teams, making the difficult decision to reduce 10% of their workforce.

Several exchanges have laid off employees. Source: edited image, original from pixabay.com.

And the crisis also knocked at the door of the popular platform Coinbase, this company that had already announced to stop hiring new employees and expand its workforce, had to go further, and had to cancel the job offers already accepted to all new hires who had not yet started.

These layoffs in the cryptocurrency sector are a consequence of the current crisis that this ecosystem is going through, and which was accelerated by the resounding fall of Terra's UST; according to Coinmarketcap data, the current capitalization of cryptocurrencies is approximately $1.2 billion, which means a fall of approximately $600.000 million in one month.

Screenshot taken from Coinmarketcap.

This has undoubtedly affected many companies that handle venture capital, leading them to face difficult decisions, such as gambling the future by seeking external financing to maintain their current pace or making the necessary adjustments to survive the crypto-winter, even if this means making the painful decision to lay off many employees.

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