The so-called “crypto winter” – a period when cryptocurrency prices drop dramatically, resulting in huge losses for investors who hold these assets in their portfolio – led to a wave of layoffs in this sector, which has already exceeded 28,000 since then. April last year.
According to a survey published by the cryptocurrency website CoinDesk, 28,144 jobs in the sector were closed during this period. The survey was based on reports and announcements made by about 50 companies. Cuts ranged from 20% to 40% of the companies’ employees.
The latest case concerned the Crypto.com exchange, which was a sponsor of the World Cup in Qatar. The company, which had already cut back in October last year, announced on Friday (13/1) a 20% reduction in its staff.
In the first month of 2023 alone, at least six companies have already launched: Blockchain.com, ConsenSys, SuperRare, Huobi, Genesis, and Silvergate. American Coinbase has already reported that it will fire 950 professionals.
In November last year, another industrial giant, the Kraken Exchange, laid off more than a thousand employees.
The scale of the crisis
The new edition of the so-called “crypto winter” was marked by corporate failures, panic over large-scale losses, a rush for withdrawals, and doubts about the future.
“The volatility of these assets is naturally high, with impressive highs and often faster declines,” explains Isaac Costa, Professor at Ibmec and Partner at Warde Advogados. “There is an old saying that the market goes up stairs and down elevators. In the case of the cryptocurrency market, it goes up an elevator and it comes down a roller coaster.”
The fall of the cryptocurrency was fueled by the collapse of FTX, which caused a crisis on a global scale.