Crypto.com said on Friday it would be reducing about 20 per cent of its workforce, as cryptocurrency exchanges face industry-wide challenges brought on by the collapse of FTX last year.
The Singapore-based company’s announcement comes amid concerns about reserves and solvency across the sector, and only a few days after rival exchanges Coinbase Global Inc (COIN.O) and Huobi announced their plans to lay off about 20 per cent of their staff. A source told Reuters last week that Genesis, too, had cut jobs, equating to 30 per cent of its workforce.
The layoffs at Crypto.com would be its second in about six months, after it reduced jobs in July last year to weather the macro economic downturn amid rising interest rates.
Th recent FTX collapse “significantly damaged trust in the industry,” Crypto.com Chief Executive Officer Kris Marszalek said in a statement.
“It’s for this reason, as we continue to focus on prudent financial management, we made the difficult but necessary decision to make additional reductions in order to position the company for long-term success.”
The collapse of Sam Bankman-Fried’s FTX was the biggest in string of big crypto-related failures in 2022. It sparked a cryptocurrency rout and has left an estimated 1 million creditors facing losses of billions of dollars.