The combination of an ongoing bear market and global economic struggles has taken a toll on crypto companies, causing delays, layoffs, and AI transformations.
This week, cryptocurrency protocol Algorand announced it would involuntarily cut its workforce by 25%.
Algorand claimed that the “severe” job cuts were in response to the “uncertain global macro environment and widespread weakness in the crypto market.”
Indeed, as the year begins, Bitcoin prices have struggled to regain upward momentum after falling to $63,000 in late February.
The escalating war between the United States, Israel, and Iran is also causing oil prices to soar, threatening to deepen economic turmoil around the world.
Cryptocurrency headcount reductions, reductions, and delays
Companies such as Gemini, Messari, Crypto.com, OP Labs, OpenSea, and Kraken have announced a variety of business reductions, including layoffs and delays in planned operations.
Meanwhile, Crypto.com yesterday announced layoffs of 12% of its staff, citing its AI pivot. The company’s chief executive, Chris Marszalek, claimed the roles of the laid-off staff were “unable to adapt to the new world”.
Read more: Cryptocurrency mass layoffs are a short-term solution, with long-term consequences
Gemini similarly laid off 25% of its workforce in February, claiming that AI enabled it to work more efficiently with fewer employees.
Gemini also fired three executives, including Chief Operating Officer Marshall Beard, Chief Financial Officer Dan Chen, and Chief Legal Officer Tyler Mead.
On Monday, cryptocurrency analytics firm Messari announced it was “doubling down” to become an “AI-first company” and laid off various team members as new CEO Dylan Lee takes the helm.
OP Labs, which contributed to the protocol, laid off 20 staffers last week in a memo that also hinted at a possible AI shift. “This means doing less work better, making decisions faster, and reducing coordination overhead,” said CEO Jing Wang.
All of this follows one of the more dramatic AI shifts from Jack Dorsey’s Block, which laid off 50% of its workforce (about 4,000 people) while citing the advances AI brings to workplace efficiency.
Read more: How the Iran bombing changed the price of oil and Bitcoin
This week, NFT platform OpenSea announced that it would be postponing the launch of its $SEA token due to “difficult” market conditions across cryptocurrencies that could impact its launch.
A further postponement of Kraken’s initial public offering (IPO) was announced yesterday. Kraken’s parent company, Payword, has suspended its IPO plans until “market conditions improve,” the people said.
Retrenchments often come with reputational damage and further long-term consequences down the road, as staff are left shouldering the workload of departed teammates.
However, with more and more companies citing AI as a reason for downsizing, its ability to ease the burden of downsizing cannot be ignored.
