Crypto Players BlockFi, Crypto.Com Announce Lay-Offs Citing Dramatic Shift in Macroeconomic Conditions

Zac Prince and Kris Marszalek, the CEOs of BlockFi and Crypto.com respectively, informed about their corporate decisions on detailed Twitter threads.

By Radhika Parashar | Updated: 14 June 2022 14:45 IST

Crypto Players BlockFi, Crypto.Com Announce Lay-Offs Citing Dramatic Shift in Macroeconomic Conditions

Photo Credit: Pixabay/ Mohamed Hassan

The crypto industry is currently facing a downturn, firms are looking to optimise profitability

Highlights

BlockFi and Crypto.Com are laying off around 500 people collectively
Web3 businesses struggling to see profits
Crypto market down by 13.74 percent in the last 24 hours

Two Web3 firms, BlockFi and Crypto.com have announced lay-offs from their respective companies in the backdrop of the current industry slowdown. While BlockFi, the crypto trading and lending platform is firing around 200 employees from its workforce, exchange Crypto.com is letting go of up to 260 workers. Both the companies have cited similar reasons for shedding their workforces — the ongoing slump in the global crypto market. Registering a decline of 13.74 percent in the last 24 hours, the crypto market cap has shrunk below the mark of $1 trillion (roughly Rs. 78,00,655 crore).

Zac Prince and Kris Marszalek, the CEOs of BlockFi and Crypto.com respectively, informed about their corporate decisions on detailed Twitter threads.

“Like many others in tech, we've been impacted by the dramatic shift in macroeconomic conditions, which have had a negative impact on our growth rate. On the path towards profitability, we have been managing costs throughout our business such as slowing headcount growth and reducing our team size,” Prince wrote.

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The BlockFi chief has also claimed that executive salaries for the company have also been axed in these times of turmoil.

On the path towards profitability, we have been managing costs throughout our business such as:
- Reducing marketing spend
- Eliminating non-critical vendors
- Reducing executive compensation for myself, Flori and other execs
- Slowing headcount growth and reducing our team size
— Zac Prince (@BlockFiZac) June 13, 2022

On similar lines, Marszalek also said that for now, Crypto.com needs to optimise profitability.

“That means making difficult and necessary decisions to ensure continued and sustainable growth for the long term by making targeted reductions of approximately 260 or five percent of our corporate workforce,” the Crypto.com chief noted.

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We will continue to evaluate how to best optimize our resources to position ourselves as the strongest builders during the down cycle to become the biggest winners during the next bull run.
— Kris | Crypto.com (@kris) June 11, 2022

The crypto industry is currently facing a downturn, with several factors pressuring the situation further.

Earlier this month, for instance, crypto trading platform Celsius network suspended all withdrawals on its lending platform. The company defended its decision citing ‘extreme market conditions' and a need to ‘stabilise liquidity.

Binance crypto exchange has also halted BTC withdrawals for its users after transactions were getting stuck.

Temporary pause of $BTC withdrawals on #Binance due to a stuck transaction causing a backlog. Should be fixed in ~30 minutes. Will update.

Funds are SAFU.
— CZ :large_orange_diamond: Binance (@cz_binance) June 13, 2022

For now, Bitcoin has also taken a u-turn on the price charts.

On Tuesday, June 14 — Bitcoin values dipped by 16.51 percent. As per Indian exchange CoinSwitch Kuber, BTC is trading at $23,331 (roughly Rs. 18 lakh). This tumble of the world's oldest cryptocurrency comes in the backdrop of the hiked inflation rate in the US as well as the recent crash of crypto lending platform called the Celsius Network.

On international exchanges as well, BTC fell by over 16.42 percent to trade at $21,924 (roughly Rs. 17 lakh).

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Further reading: Cryptocurrency, BlockFi, Crypto.Com

Radhika Parashar

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Radhika Parashar is a senior correspondent for Gadgets 360. She has been reporting on tech and telecom for the last three years now and will be focussing on writing about all things crypto. Besides this, she is a major sitcom nerd and often replies in Chandler Bing and Michael Scott references. For tips or queries you could reach out to her at RadhikaP@ndtv.com. More