Cointime

Download App
iOS & Android

Crypto Layoffs Mount As Exchanges Continue To Be Ravaged by the Prevailing Bear Market.

There’s no denying that the crypto market has been gripped by immense bearish pressure over the past year, as made evident by the fact that the total capitalization of this sector has continued to hover below the $900 billion mark for most of the year after having scaled up to an all-time high of $3 trillion in 2021.

These conditions have been characterized by many companies facing insolvency, as well as many of the world’s top exchanges laying off their staff in recent months. Moreover, the recent FTX debacle has set in motion a contagion effect that has continued to have a major effect on several crypto platforms, dissuading newer investors from entering the space in the process.

Since Q2 2022, a host of prominent crypto entities (including many digital asset trading and lending platforms) such as Terra, Celsius, Bbl, Voyager Digital, Vauld, FTX, Alameda Research and BlockFi, among others, have either collapsed entirely or filed for bankruptcy, thus suggesting more incoming pain for the industry.

Layoffs continue en masse

As the market continues to be faced with major headwinds, several crypto companies, especially exchanges, have had to let go of their workforce. It is estimated that over the first eleven months of the year alone, the industry has witnessed over 26,000 layoffs.

In November, leading cryptocurrency trading platform Coinbase announced a fresh round of job cuts, with the firm reportedly firing more than 60 employees from its recruiting and institutional onboarding teams. What’s more, is that earlier this year, the company laid off 18% of its staff (approximately 1,100 oppositions), with company CEO Brian Armstrong admitting that he had hired more personnel than were required to begin with.

Similarly, on Nov. 30, cryptocurrency exchange Kraken announced that it was going to be parting ways with 30% of its global workforce — which works out to over 1,000 employees — amid the ongoing market downturn. A spokesperson for the firm noted in a blog post:

“Since the start of this year, macroeconomic and geopolitical factors have weighed on financial markets. This resulted in significantly lower trading volumes and fewer client sign-ups. We responded by slowing hiring efforts and avoiding large marketing commitments. Unfortunately, negative influences on the financial markets have continued and we have exhausted preferable options for bringing costs in line with demand.”

It is worth noting that back in June, the company had stated that it was looking to expand and grow its operations, primarily by adding 500 experienced individuals (laid off from other firms) to its roster.

Lastly, the aforementioned layoffs haven’t been confined to just American crypto firms, with prominent Australian digital asset exchange Swyftx announcing recently that it had cut 90 jobs. Prior to this development, the company had excused 260 employees, effectively bringing down its total workforce by 35%. Similarly, popular cryptocurrency exchange Lemon Cash, which has large-scale operations in Argentina and Brazil, announced a 38% cut in its workforce a month ago, citing the lack of a clear recovery horizon.

Other similar instances worth noting

Akin to the developments noted above, crypto exchange Bybit too announced that it was going to be initiating a fresh round of job cuts (estimated to be around 250 positions). To this point, company CEO Ben Zhou revealed on Twitter that the firm is currently trying to manage its expenses by refocusing its day-to-day operations, especially with a deepening bear market. According to Zhou, this latest decision will have a direct effect on 30% of his staff, adding:

“Planned downsizing will be across the board. We are all saddened by the fact this reorganization will impact many of our dear Bybuddies and some of our oldest friends.”

Unchained Capital, a Bitcoin (BTC) financial services firm, let go of nearly 630 people in November, effectively reducing its manpower by 15%. In a recent post pertaining to the job cuts, company co-founder and CEO Joe Kelly noted that the layoffs did not have anything to do with the recent FTX saga, stating, “Funding for Bitcoin-backed loans has been materially constrained by recent market events.”

Digital asset and blockchain firm Galaxy Digital, helmed by popular investor Mike Novogratz, also plans on reducing its staff by at least 20% (nearly 170 employees) in order to focus on building for the future and maximizing shareholder value in the long run. It bears mentioning that since the turn of the year, Galaxy’s share value has depleted by a staggering 80%.

Venture capital company focusing on the digital currency market Digital Currency Group (DCG) also downsized by nearly 13% recently, letting go of 66 employees in the process. The crypto conglomerate, which was founded by billionaire Barry Silbert, said it is looking to restructure its finances while also promoting several senior executives.

It is interesting to note that DCG subsidiary Genesis Global Trading is one of the key entities involved with the collapse of 3AC, a popular crypto hedge fund that was one of the first major casualties of the year. DCG’s Genesis Asia Pacific Ltd. had lent Three Arrows $2.4 billion, with the hedge fund putting down the equivalent of $1.2 billion in crypto and other collateral back in October.

Lastly, Dapper Labs, the company behind popular projects including CryptoKitties, NBA Top Shot, NFL All Day, UFC Strike and the Flow blockchain, reduced its headcount by 22% (135 employees) in November.

Founder and CEO Roham Gharegozlou noted, “These reductions are the last thing we want to do, but they are necessary for the long-term health of our business and communities. We know Web3 and crypto is the future across a multitude of industries – with 1000x potential from here in terms of mainstream adoption and impact – but today’s macroeconomic environment means we aren’t in full control of the timing.”

To gain a better understanding of the recent layoffs, Cointelegraph reached out to Xiao Xiao, investment director at HashKey Capital, a digital asset financial services group. In his view, the layoffs are a result of the exchanges being overstaffed as well as the prevailing crypto winter, adding:

“During the bull market, there are many businesses to attend to. Often exchanges work to introduce new business lines, which means it makes sense to hire more people, sometimes more than needed. But in a bear market, companies tend to focus on how to allocate capital more efficiently. When considering their potential ROI, it may not be the right timing for a new business line.”

He noted that as things stand, many companies are trying to cut down on unnecessary costs and are trying to prepare for the next bull run, which is difficult since it requires a lot of personnel. “For many big exchanges, the cash situation remains strong, and therefore they have the ability to retain big teams,” Xiao stated.

Gökberk Kızıltan, head of communications for Snapmuse.io — a Web3 platform for content creators — told Cointelegraph that the crypto market fluctuates in parallel with the boom and bust cycles of the tech industry: During every bull market, hundreds of projects appear with their valuations going higher. Then, during bear runs, users make a swift exit, leaving projects with dwindling funds. He added:

“Exchanges underpin this ecosystem. As the gateway to crypto, they are the ones that are required to step and start hiring during times of demand. When conditions change and a crypto winter inevitably sets, they often find themselves too big to survive the conditions. Layoffs are their survival method. The flexibility to hire and lay off based on market conditions give them the agility to satisfy market expectations during booms and busts.”

He further noted that the layoff issue is not specific to the crypto industry alone, stating that the poor macro market conditions also are reflected in the Nasdaq as the tech industry at large has seen a large number of job cuts recently. “I don’t see the reaction of the exchanges to today’s ongoing headwinds any different from those being experienced by most conventional tech companies,” Kızıltan added.

What lies ahead?

The recent slew of collapses that have hit the market stand to usher in a new wave of regulations in the near term. In this regard, up until now, the United States Securities and Exchange Commission and its chairman, Gary Gensler, have continued to stay on the fence when it comes to providing clarity about the legal status of digital assets.

With the FTX downfall sending shockwaves across the globe, however, lawmakers seem to have been left with little to no choice but to implement regulations in the near term. In fact, many believe that the enforcement of quality regulations could revive the crypto economy, helping newer investors enter the market. Therefore, as we head into a future driven by decentralized technologies, it will be interesting to see how the crypto job sector continues to evolve.

Comments

All Comments

Recommended for you

  • Foxconn Estimates Capital Expenditure to Increase Over 30% Year-on-Year

    On August 12, Foxconn's Chief Financial Officer Huang De-cai stated at a financial briefing that the group's capital expenditure for the first half of this year was approximately NT$80.9 billion, an increase of NT$3.7 billion year-on-year. It is estimated that this year's capital expenditure will grow by over 30% year-on-year, in response to demand for AI server cabinets and regional manufacturing. The company is proactively expanding key capacities such as server cabinets, liquid cooling, and testing, while also strengthening its global manufacturing and automation layout. Huang noted that future capital expenditure and working capital needs are expected to rise, but the group currently has sufficient internal cash generation capabilities and financing capacity to support growth.

  • New York City Council Investigates Regulatory Pressure on Prediction Markets like Polymarket

    On August 12, news reports indicated that the New York City Council is investigating the advertising practices of four major prediction market platforms, opening a new battleground for the legal controversies facing this rapidly evolving industry. City Council Speaker Julie Menin sent a letter containing numerous questions to Polymarket, Kalshi, Coinbase Global Inc., and the prediction market platform Titan under Gemini Space Station, as part of a so-called legislative inquiry aimed at examining whether existing city laws are sufficient to protect residents from false or deceptive marketing by these emerging platforms. The City Council is also exploring the development of related policies to address products that may lead users to engage in 'compulsive betting on event contracts.' In its letter to Polymarket, the City Council stated: 'The Council is investigating the allegations involving Polymarket and, more importantly, is examining the prevalence of similar marketing practices within the broader prediction market industry and the associated social harms to residents of New York City.' (Jinshi)

  • AI Computing Power is Being Packaged as a Financed Asset

    According to Silicon Data, the rental prices for A100, H100, H200, and B200 in the non-Hyperscaler market are approximately $1.65, $2.72, $3.29, and $5.61 per GPU hour, respectively. The H100 has rebounded significantly from $2 at the end of last year, while the B200 and H200 have also strengthened concurrently. Based on a 36-month forward rental curve, the estimated residual value of the H100 has risen from $14,000 in October last year to about $20,000 currently (residual value refers to model valuation, not actual transaction price). The rental trend supports Jensen Huang's logic of assetizing computing power: once GPUs stably generate inference rental income, they can be financed through future cash flow collateral, similar to airplanes and ships. On August 10, NVIDIA, in collaboration with Apollo, BlackRock, and others, promoted over $500 billion in AI infrastructure financing, with some loans secured by equipment. NVIDIA may provide up to 25% guarantees based on residual value. If this model is established, it will reduce Neo-cloud financing costs and stimulate GPU demand. However, it is important to note that Silicon Data's own second-hand market data shows that the listing price of a 3-year-old H100 is only 20%-30% of the peak price of new models, indicating significant technological depreciation. The stable rental income from the A100 over six years only suggests that older models still hold value in low-cost scenarios such as inference and fine-tuning. A more accurate assessment is that the economic lifespan of GPUs may exceed the previously assumed 2-3 years, with strong inference demand offsetting some technological depreciation, which is crucial for the collateral valuation in the $500 billion financing plan.

  • Bank of Russia Limits Retail Crypto Trading to Bitcoin, Ethereum, and USDT Starting September 1

    The Bank of Russia will restrict retail investors from trading cryptocurrencies on regulated exchanges starting September 1, allowing transactions only in Bitcoin, Ethereum, and USDT. Non-qualified investors will have an annual purchase limit of 300,000 rubles, approximately $3,600, through a single intermediary. Qualified investors will not have a limit. These regulations further clarify the legislation passed in July, but cryptocurrency payments within Russia remain prohibited under current laws. (CoinDesk)

  • Central Bank: Gradually Increase the Frequency of Overnight Reverse Repo Operations to Enhance Policy Rate Transmission

    On August 12, the Central Bank released the 2026 second quarter report on China's monetary policy implementation. The report stated that moving forward, the People's Bank of China will continue to steadily and orderly promote the reform and improvement of the monetary policy operation framework. It will flexibly and accurately carry out various operations, maintain the total liquidity at an appropriate level, and better guide the stable operation of short-term interest rates in the money market. In response to the needs of primary dealers, the frequency of overnight reverse repo operations will be gradually increased to further enhance the transmission of policy rates to market rates.

  • Sources: No Discussions on Extending Ceasefire

    On August 12, according to Reuters, a senior Iranian source stated: "There are currently no discussions between Iran and the United States regarding the extension of the ceasefire. From Iran's perspective, the ceasefire does not have an effective date, so there is no need for an extension. The United States violated the temporary agreement 48 hours after it was reached and withdrew from the agreement a few days later. One of the issues currently being discussed is the U.S. return to the memorandum of understanding and determining a timeline for the U.S. to fulfill its commitments, but there has been no progress on this issue so far." (Jinshi)

  • Central Bank: Current Social Financing and M2 Growth Rates Exceed Nominal GDP Growth, Monetary Environment Remains Relatively Loose

    On August 12, the People's Bank of China released the 2026 second quarter report on the implementation of China's monetary policy. The report states that social financing scale and broad money M2 are macro financial aggregate indicators with a wide coverage. These two indicators approach the financial and real economy, as well as assets and liabilities, from different perspectives, encompassing a diverse range of financing channels and providing a comprehensive view of financial aggregates. It is also necessary to objectively and scientifically assess their trends. Mathematically, as bond financing increases, the growth rates of M2 or deposits may naturally differ from those of loans, which does not indicate insufficient financial support for the real economy or idle capital. Compared to the growth rate of nominal GDP, the current growth rates of social financing and M2 still exceed that of nominal GDP, indicating a relatively loose monetary financial environment.

  • Central Bank: Timely Planning of Practical Incremental Policies to Strengthen Counter-Cyclical Regulation

    On August 12, the Central Bank released the 2026 second quarter report on the implementation of China's monetary policy. The People's Bank of China will timely plan and implement practical incremental policies, enhance counter-cyclical regulation, and strengthen the expansion of domestic demand and optimization of supply to promote sustained and improved economic development. It will steadfastly follow the path of financial development with Chinese characteristics, further deepen financial reform and high-level opening-up, accelerate the construction of a strong financial nation, improve the central banking system, and build a scientific and robust monetary policy system along with a comprehensive macro-prudential management system, ensuring smooth transmission of monetary policy mechanisms. (Jin Shi)

  • U.S. Stock Index Futures Rise Short-Term, Nasdaq 100 Futures Up 0.7%

    U.S. stock index futures have risen short-term, with Nasdaq 100 futures up 0.7%. U.S. Treasury bonds have increased, and the yield on the 10-year Treasury note has fallen by 3 basis points to 4.66%.

  • Musk: AI to Account for 99% of SpaceX Valuation, Aiming for 10 GW Computing Power by End of Next Year

    On August 12, Musk stated in his latest remarks that AI revenue will surpass all other business revenues of SpaceX by September, and he predicts that within five years, AI will account for 99% of SpaceX's valuation. Musk mentioned that SpaceX has established 'the world's most powerful AI training cluster' and plans to increase its current computing power by about tenfold by the end of next year, targeting 10 gigawatts, which corresponds to a potential annual revenue of $300 billion to $500 billion. He also anticipates that Starlink could handle over 90% of global internet traffic in the future.