The impending bear market is continuing to wreak havoc as major crypto companies are forced to initiate large amounts of lay-offs to mitigate losses as a result of recent bearish market conditions.
Coinbase’s CEO and co-founder Brian Armstrong announced on Tuesday they will be laying off around 18% of its workforce, about 1,100 employees. Coinbase announced the lay-offs to employees via their personal emails because the company decided to immediately “cut access to Coinbase systems for affected employees” following the decision.
“Given the number of employees who have access to sensitive customer information, it was, unfortunately, the only practical choice, to ensure not even a single person made a rash decision that harmed the business or themselves.”
Armstrong also added in response to the lay-offs:
“Our team has grown very quickly … and our employee costs are too high to effectively manage this uncertain market,” Armstrong said. “The actions we are taking today will allow us to more confidently manage through this period even if it is severely prolonged.”
Alongside them, Crypto.com announced via Twitter on Friday that the company plans to release 260 workers, which is around 5% of their workforce.
Just like Armstrong expressed, the company hired a considerable amount of employees during its boom just a few months ago. Also during this boom, the company reportedly purchased the sports arena formerly known as the Staples Center, home of the Lakers, for a whopping $700 million.
Finally, BlockFi joins the funeral by announcing on Monday via blog post that they’ll be laying off 20% of their 850 employees – around 170 to 200 people.
The layoffs come as the crypto market is struggling as a whole. The value of Bitcoin and Ethereum have been falling throughout Monday morning, and Celsius, a lending platform, has halted withdrawals, citing “extreme market conditions.”
Binance, a large crypto exchange, paused Bitcoin withdrawals for about three hours, citing a technical issue, and within the past few months, we’ve seen coins like Terra essentially go to zero.
Crypto firms have struggled to weather the storm. Coinbase announced that it was slowing hiring in May and reportedly rescinded over 300 job offers the next month; several other companies, like Gemini, Mercado Bitcoin, and Bitso have also had to lay off at least 10 percent of their workers within the past month.
The companies blame the macroeconomic conditions surrounding both the traditional and crypto markets. The effects are not confined to the crypto space, with other tech and finance-related companies being hurt, such as Klarna, Tesla, Cameo, and Netflix, which have all announced intentions to lay off sizable amounts of their employees. Even mega-company Meta, formerly Facebook, announced they’d respond to market conditions by slowing hiring.