Crypto exchange Kraken announced that it would lay off 30% of its global workforce, or over 1,100 individuals, in response to the bearish crypto market.
Kraken said in a blog post that since this year’s beginning, financial markets had been impacted by macroeconomic and geopolitical variables. This resulted in drastically reduced trading volumes and customer recruitment.
According to CEO and co-founder Jesse Powell, Kraken had to cut its workforce due to the current crypto ecosystem. The latest reduction brings the company’s headcount back to where it was twelve months ago. Powell stated in a tweet, “Macro was already tough and we held out but recent industry woes diminished near-term optimism about a crypto rebound.”
Rough day at @krakenfx. Headcount rolled back 12 mos. Macro was already tough and we held out but recent industry woes diminished near-term optimism about a crypto rebound. Better positioned now. Glad we were able to take good care of our former colleagues. Been a privilege. 🙇♂️ https://t.co/xfwShapS2N
— Jesse Powell (@jespow) November 30, 2022
Bitcoin (BTC) has lost 63% of its value since the end of 2021, and the market capitalization of all cryptocurrencies has decreased by more than two-thirds over the past year. Companies that increased their workforces during the prior boom years have been forced to lay off staff during the current downtrend.
For instance, Coinbase (COIN), a publicly traded crypto exchange, and Unchained Capital, a bitcoin financial services company, recently laid off 60 and 600 employees respectively.
In June, Kraken stated that it was trying to expand as other companies laid off employees, flooding the market with experienced workers. It also intended to hire an additional 500 individuals.
The company stated, “We have not adjusted our hiring plan, and we do not intend to make any layoffs.”