Crypto exchanges delete jobs because market turbulence trigger a trade down

Large stock exchanges for digital assets relieve hundreds of employees in an abrupt reversal of the breakneck expansion of the industry, as a two-year heat wave makes space for a crypto frost phase.

The Coinbase noted in the USA announced on Tuesday to relieve almost a fifth of its workforce, which corresponds to more than 1,000 employees, and joined competitors such as Gemini, Crypto.com and Blockfi during personnel reduction, since this year's slump in crypto prices is suffocating the commercial activities.

"If there is no trading volume, there is no money.

The market value of the 500 largest crypto tokens in the world has broken down from a maximum of $ 3.2 trillion in November to less than $ 1 trillion this week, which reversed years of winnings with important coins such as Bitcoin and Ether.

The sweater reflects a wider decline in the global financial markets, but was more serious in the most speculative asset classes, at a time when the central banks withdraw from the stimuli they recharged in 2020.

crypto investors tend to act much more active while bull markets. Now falling volumes are eating the once juicy fees that deserve stock exchanges by facilitating the trade.

According to calculations of the Financial Times based on CryptoMpare data, the Spot trading volume on the large crypto platforms from March to May was around $ 800 billion per month, fewer than half of the level in the same period of 2021.

Coinbase had grown to around 6,000 employees from 3,730 at the end of last year because it mastered the exuberance on the cryptoma markets.

also competitors who were booming in recent years tear their growth plans. The Gemini crypto exchange said at the beginning of June that it would be released 10 percent of its employees under "turbulent market conditions", of which the founding brothers Winklevoss said they could "continue" for some time. In the past few days, Crypto.com also said that it would reduce 5 percent of its workforce, about 260 people, and the KRYPTO credit platform Blockfi is released a fifth of its workforce, about 170 people

The Brazilian Mercado Bitcoin recently released 90 employees, around 12 percent of its employees. Director Fabricio Tota said that the exchange rose from 200 to 700 in almost a year in 2021.

"If you grow so quickly, you don't grow in an organized way. So it is time to look for inefficiencies and be better organized," said Tota.

Coinbase was already confronted with a counter -reaction both within and outside the company. Restrict plans were announced last month and even some job offers were canceled. CFO Alesia Haas said last week in a panel interview that "we operate in an insecure time".

John (name changed) had terminated his job and prepared to move from Europe to London for a job at Coinbase. "Everything was packed here. Every move is a big deal, you can get everything fine, you say goodbye to people, I have had an appointment here. The whole thing just collapsed," he said. After his visa application for the United Kingdom failed, he tried to return to his old job.

rick chen, head of public relations at the platform blind to exchange employee information, said that Coinbase had assured people that offers were not revoked. "A few weeks later, to have whitewashes where this is not the case, I haven't seen anything like this yet," he said. Coinbase referred to a blog post and Twitter posts of leading managers and did not make any further comment.

A former Gemini manager said that the recent announcement of the company was only the top of the iceberg, and claimed that the stock exchange was "overwired" in last year's crypto bull market.

"Ten percent are completely understated. Without letting people know, Gemini has had important people going since March," said the former employee. Gemini refused to comment.

Charley Cooper, Managing Director of the Blockchain software company R3, warned that the crypto industry is often grasped by "hybris".

"The laws of the economy also apply to crypto. It is very difficult to convince the people in mainstream finance that they are serious about the business if they constantly believe that their investment classes are immune to the laws of the economy," he said.

The increasing regulation of cryptoassets has also increased the costs for the operators. "If you do it right, the effort for regulatory matters is enormous because we have to immerse yourself in the Old World and have to keep up with the new world," said Eric Demuth, CEO of the Austrian Bitpanda Stock Exchange.

But the cold that feels the stock exchanges can depend on your business model, e.g. B. whether they offer trading with derivatives or rely on institutional dealers to achieve revenue.

In the past three months, trading with derivatives that facilitate bets in the future direction of the coins has decreased by 17 percent compared to the highest levels, much less than the decline for cassacurse, says CryptoCommare.

The crypto exchange FTX, which employs 300 employees, said that it remains "strongly profitable". Binance, the most volume -strongest stock exchange, said she would continue her pace of attitude. "We believe that cooler markets offer the best opportunity for companies to invest or acquire them in great projects at a cheaper price," said Binance.

The managing director of Okex, Lennix Lai, said the Börse Plane to increase its 2,800 employees by 30 percent next year.

But for people like John it was a tough lesson.

"I would welcome it if people had a sufficiently long memory to punish companies that behave in this way, but unfortunately we live in a world with a one -week memory for the most scandalous topics," he said.