- R3, an enterprise blockchain company, has reduced its workforce by around 20% to restructure and cut costs.
- The company cited challenging economic conditions as the primary reason for the change in focus and business strategy.
- The layoffs affected slightly more than one-fifth of the company’s workforce, affecting various functions and global operations.
R3, a prominent enterprise blockchain company, has taken a significant step by reducing its workforce by around 20% as part of its ongoing efforts to restructure and cut costs. The company made this decision public through a blog post, citing challenging economic conditions as the primary reason behind its shift in focus and business strategy.
In the blog post, R3 explained, “In light of our renewed strategic focus, we are also optimizing our internal operations, regrettably resulting in a reduction of personnel across various departments.” However, they did not disclose the exact number of employees affected by these layoffs.
According to sources familiar with the matter who spoke to Bloomberg, the layoffs impacted slightly more than one-fifth of the company’s workforce, affecting various functions and global operations. While R3’s headquarters are located in New York, a significant portion of its software development activities takes place in its UK office.
The enterprise blockchain sector has made progress over the years but still tends to have a slow pace of development, often involving projects that span several years. R3 had initiated numerous initiatives and partnerships with industry leaders like DTCC, Euroclear, SIX (the Swiss stock exchange), and the Central Bank of the UAE in the clearing and settlement sector.
However, some of these projects progressed slowly, and others were abandoned, leading to revenue losses for R3, according to insider sources.
Despite the workforce reduction, the company, which was founded in 2015, asserts that it remains financially stable. This is despite having raised $107 million in funding six years ago from leading banks such as Barclays, Bank of America, and Wells Fargo.
R3 stated, “This restructuring not only guarantees agility and efficiency throughout the organization but also secures R3’s capacity to innovate, expand, and meet the needs of its clients, even in the face of market uncertainties.”
Originally formed as a consortium of major banks, R3 provided these banks with a shared platform for blockchain innovation. In 2017, it transitioned into a private entity, focusing on developing blockchain solutions for financial service providers.
This year, R3 announced partnerships with the Central Bank of the UAE and the Central Bank of Nigeria for their respective Central Bank Digital Currency (CBDC) projects. In the case of Nigeria, R3 is set to introduce a blockchain-based system that will give the Central Bank full control over its emerging eNaira.
It’s worth noting that R3 and the Qatar Financial Centre Authority (QFCA) announced a broad collaboration in April 2023, which includes the potential creation of a lab environment to assist commercial banks and fintech firms in experimenting with distributed ledger technology (DLT).