Crypto Winter is here Cryptocurrency Exchange fires 1,100 globle workforce

Image Credits: CryptoAvanza

The world’s third-largest cryptocurrency exchange laid off more than 1,100 employees and declared a crypto winter. The company said in a blog post that the weakening in crypto markets was caused by slowing macroeconomic and geopolitical factors.

Kraken, which is the world’s third-largest cryptocurrency exchange by volume, is letting go of about 30% of its staff, according to the company’s CEO.

“Today we’re announcing one of the hardest decisions at Kraken to date. We’re reducing our global workforce by approximately 1,100 people, or 30 percent, in order to adapt to current market conditions.” said in a blog post

Kraken is an exchange and bank for cryptocurrency based in the United States. It was founded in 2011. It was one of the first bitcoin exchanges to be listed on Bloomberg Terminal. As of the middle of summer 2022, it was said to be worth $10.8 billion USD. As of the year 2020, Kraken had made US$1.1 billion.

Why did the Crypto Exchanges fire workforce?

After the luna UST event, the crypto market is still in survival mode because the luna incident hit the crypto market hard and caused a $60 billion wipeout from the market in just a couple of days. The luna incident affected Celius, Voyager, BlockFi, and 3CA because they heavily invested in luna stablecoin UST.

The market has already survived the failures of Luna and other crypto-lending companies. So now that FTX Exchange has collapsed on November 11, the crypto market is in even more pain, which is why the crypto market has far too much cash flow volume to survive, particularly for centralized exchanges.

Finally, BlockFi also submit Chapter 11  Bankruptcy after the FTX submit bankruptcy. that’s a reason Exchange fie workforce to manage cash flow because back-to-back bad events demoralized people’s trust.

Kraken Blog Post

Powell said in a blog post that “macroeconomic and geopolitical factors” were to blame for the slowing growth, which had reduced customer demand, trading volumes, and sign-ups.

“We had to grow fast, more than tripling our workforce in order to provide those clients with the quality and service they expect of us. This reduction takes our team size back to where it was only 12 months ago.” said a blog post.

Kraken said it would pay out 16 weeks of pay as severance and give the affected workers more time to leave.

“I remain extremely bullish on crypto and Kraken,” Powell added

“Kraken Takes Steps to Weather Crypto Winter” blog post title