The fall in the price of cryptocurrencies has generated countless problems in the sector.
From the more than $64,000 each Bitcoin was worth in March 2022, it plummeted to the current $16,000.
It is a drop of more than 65% that has scared many of the investors who understood that the “boom” of cryptocurrencies was over and, in the middle, billions of dollars remained.
The confidence debacle was consolidated when the stablecoin linked to the crypto project Luna fell, and plunged further when in October one of the most important exchanges in the world, FTX, went bankrupt, dragging down the savings of hundreds of thousands of people.
The fall of FTX affected other companies in the sector, such as BlockFi, which due to its exposure to the Sam Bankman-Fried exchange, the lender was unable to operate again, invoking the famous Chapter 11 of the United States bankruptcy law.
BlockFi argued in its presentation the fall in cryptocurrency prices and the collapse of FTX.
Coinbase and the mass layoffs
The novelty this Tuesday, January 10 is a second round of layoffs affecting Coinbase, the largest crypto exchange in the United States.
Coinbase is laying off a fifth of its workforce following a staff reduction it carried out in June 2022 and that affected 18% of the workers at that time.
CEO Brian Armstrong argued the pressure on the cryptocurrency sector thanks to “unscrupulous players in the industry”, referring to FTX and Bankman-Fried, publishes CNBC.
As announced, the exchange it plans to lay off 950 employees of the approximately 4,700 it had until the end of September. The argument when laying off 18 percent of the workforce in June was “the need to manage costs” for having grown “too fast” in the bull market.
The layoffs and the consequent compensation will generate extra expenses of between 150 million and 165 million dollars that will impact the first quarter of 2023.
According to the firm, the separations, together with other restructuring measures, will allow Coinbase to reduce operating expenses by 25 percent in the fiscal quarter ending in March.
The company also said it expects to end 2022 with a total loss of $500 million.
The reality of Coinbase in the stock market is not good: Shares of the New York-listed company are down more than 83 percent in 2022.
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