BlockFi co-founders Zac Prince and Flori Marquez said on 13th June that the crypto lending firm will lay off around 20% of its employees due to market circumstances, showing negative effect on the firm.
JUST IN: #Crypto lending platform BlockFi will lay off around 20% of its staff due to market conditions.
— Watcher.Guru (@WatcherGuru) June 13, 2022
CEO of Crypto.com, Kris Marszalek stated on 11th June that the Singapore-based exchange is planning to cut down 5% of its workforce, around 260 people, due to prolonged market selloffs.
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 5% of our corporate workforce.
— Kris | Crypto.com (@kris) June 11, 2022
Gemini, first of a US-based crypto exchange, announced 2 weeks ago that it will be cutting down 10% of its workers. Similarly, Coinbase has announced a recruiting freeze for the “near future” and also intends to cancel other employment offers.
Blockfi to fire off 20% of its staff
Blockfi entered the wave of firms cutting off employees on June 13, announcing that around 20% of its workforce will be let go.
This morning we announced that after taking significant time to plan and consider, we are reducing our headcount by roughly 20%. This is not a decision we take lightly and is one that brings us great sadness.
— Zac Prince (@BlockFiZac) June 13, 2022
The co-founders of BlockFi wrote in the blog post:
“We’ve been through several tough days at BlockFi in the past, but today is probably the hardest. Like many others in the Tech industry, we have been impacted by the dramatic shift in macroeconomic conditions worldwide. We are in the gut-wrenching position of needing to reduce our headcount today. This is not a decision we take lightly and candidly is one that brings us great sadness.”
BlockFi has been cutting costs across the board, including slowing personnel growth, removing non-critical contractors, decreasing marketing expenditure, and reducing CEO salaries.
BlockFi to rethink its approach
BlockFi was founded 5 years back in 2017 with a single retail offering, the crypto-backed lending, and has subsequently grown its retail product offerings to four product verticals spanning Earn, Invest, Borrow, and Pay, serving over 650,000 clients worldwide. It has profited from reduced borrowing rates as well as the rise in cryptocurrency values. By the conclusion of 2020, the firm had grown from 150 to over 850 people. Unfortunately, a substantial change in market situation beginning in Q1 2022 has compelled BlockFi to suspend its expansion and rethink its approach.
Since its establishment in 2017, BlockFi has allegedly raised over $957 million and also was hoping for a capitalization of near to $5 billion the year before. However, the business is in the process of acquiring a down round at a price of roughly $1 billion.
BlockFi’s co-founders also remarked, despite the failure,
“For our remaining 600+ colleagues and our clients, partners and stakeholders who have supported us worldwide – we are steadfast in our commitment to ensure BlockFi is here for the long haul”
