OpenSea to Slash 20 Percent of Workforce to Reduce Costs Amid Prolonged Slump in Digital Asset Markets

OpenSea's NFT sales volume on the Ethereum blockchain plunged to $700 million (roughly Rs. 5,600 crore) in June, down from $2.6 billion (roughly Rs. 21,000 crore) in May.

By Gadgets 360 Staff With Input From Reuters | Updated: 15 July 2022 10:32 IST

OpenSea to Slash 20 Percent of Workforce to Reduce Costs Amid Prolonged Slump in Digital Asset Markets

Photo Credit: Reuters

NFT market slumped in recent months, as cryptocurrency prices collapsed

Highlights

OpenSea hopes to maintain 5 years of growth at current volumes
Other crypto companies like Coinbase have also been forced to cut jobs
OpenSea took this step to reduce costs in the face a prolonged slump

Non-fungible token (NFT) marketplace OpenSea said on Thursday it would cut about 20 percent of its workforce to reduce costs in the face a prolonged slump in digital asset markets. "The reality is that we have entered an unprecedented combination of a crypto winter and broad macroeconomic instability, and we need to prepare the company for the possibility of a prolonged downturn," Chief Executive Devin Finzer said in a statement on Twitter.

NFTs are digital assets that exist on a blockchain and include everything from artwork to text and tweets.

Today is a hard day for OpenSea, as we're letting go of ~20% of our team. Here's the note I shared with our team earlier this morning: pic.twitter.com/E5k6gIegH7
— Devin Finzer (dfinzer.eth) (@dfinzer) July 14, 2022

OpenSea, the largest NFT marketplace, saw explosive sales growth in 2021 as the rise in cryptocurrencies created a new group of crypto-rich speculators.

But the NFT has market slumped in recent months, as cryptocurrency prices collapsed and investors ditched risky assets.

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OpenSea's NFT sales volume on the Ethereum blockchain plunged to $700 million (roughly Rs. 5,600 crore) in June, down from $2.6 billion (roughly Rs. 21,000 crore) in May and a far cry from January's peak of nearly $5 billion (roughly Rs. 40,000 crore).

Finzer said the job cuts would allow the company to maintain 5 years of growth at current volumes under various potential downturn scenarios.

Other crypto- and digital asset-focused companies, including Coinbase, have been forced to cut jobs in recent weeks.

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Recession fears coupled with the crash of crypto projects such as Terra wired a substantial amount of capital out of the crypto industry in recent months, making the slump more intense.

Last month, Coinbase itself announced the lay-off of 18 percent of its workforce in the backdrop of losses hitting the digital assets sector.

Taking full accountability of over-hiring, Coinbase CEO Brian Armstrong said that the company had onboarded too many members in recent months, that was now hindering the firm's efficiency.

Will crypto tax hurt the industry in India? We discuss this on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.

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