- NFT Firm, Dapper Labs, makes 3rd round of layoff in nine months.
- Despite the layoff of 51 full-time employees and contractors, the founder insists the company isn’t struggling.
- The company’s downsizing happened amidst the global decline in the NFT market.
Dapper Labs, a Vancouver-based blockchain platform, just announced its third round of layoffs in a tweet by its founder, Roham Gharegozlou.
“This decision was incredibly difficult because of the amazing people affected, but it is necessary and the right thing to do to ensure a lean and efficient Dapper Labs,” Roham stated in the note attached to the tweet.
The layoff follows the previous ones made last November and this February. While the crypto community speculates if the layoffs occurred due to low funding, the CEO of the blockchain-based platform states that the company and its blockchain, Flow, are both well-equipped with capital.
“Flow is also funded with a separate pool of capital, so that team also has several years of cash runway with no need to sell tokens to fund short-term operations.”
The NFT Firm founder also mentioned that the downsize is a mode of restructuring the company and growing the community healthily.
Major Decline in NFT Markets & Massive Layoffs
This round of layoffs by Dapper Labs is at a period where there is a global market decline of NFTs. The NFT boom has reduced due to the low liquidity, the general gloomy atmosphere of cryptocurrencies, and the constant NFT scams.
SuperRare and OpenSea, thriving NFT marketplaces, also laid off some employees last year due to crypto winter.
Sellers rather than buyers currently dominate the NFT community globally. The average NFT trading volume is a shadow of what it once was.
Several blue-chip collections have seen a massive decline lately. These factors have contributed to the mass layoffs in the blockchain industry lately.
Dapper Labs
Dapper Labs is an NFT platform famous for the development of blockchain-based collectibles. The company is based in Vancouver, where it oversees the management of games and entertainment on its NFT platform. Dapper Labs has created several blockchain-based games like CryptoKitties, NBA Top Shot, NFL All Day, CheeseWizards, etc.
The gaming company has raised $889 million over nine funding rounds since 2018. The company also developed Kittyverse, which enables users to play and build third-party games.
Dapper Labs Blockchain-based game, Topshot NBA, may Qualify as a Security
In February 2023, a U.S. federal Judge stated that the non-fungible tokens offered in Dapper Labs’s NBA Topshot Moments may qualify as a security. While the statement was not confirmed by the Securities Exchange Commission, using the Howey test, Judge Victor Marrero stated that
“It is the particular scheme by which Dapper Labs offers Moments that creates the sufficient legal relationship between investors and promoter to establish an investment contract, and this is a security, under Howey.”
NBA TopShot is one of Dapper Labs highest selling products. Cointelegraph reported that it generated over $230 million in NFT sales in 2021.
