© Crypto.com Commercial Matt Damon stars in Crypto.com ad "Luck favors the brave" in 2021. Crypto.com is an ad- Cryptocurrency exchange crypto.com said Friday that it is cutting 20% of its workforce.
- This led to the layoffs in July 2022, but they didn't account for the fallout from the FTX crash a few months later.
- The company's CEO said the FTX boom "significantly undermined confidence" in the cryptocurrency industry.
Crypto.com said Friday it would lay off a fifth of its staff as the fall of FTX added a new layer of pain to an already sluggish cryptocurrency market, the latest move by cryptocurrency exchanges to shrink its largest industry and technology space.
"Today we made the difficult decision to reduce our global workforce by approximately 20%," Crypto.com co-founder and CEO Chris Marsalek said in a message to employees, some of which was posted on the company's website.
Marshallek's announcement touched on the company's 2022 layoffs, which will cut 260 people, or 5% of their workforce.
"The cuts we made last July allowed us to weather the macroeconomic downturn, but that doesn't take into account the recent FTX downturn, which has significantly damaged confidence in the industry," Marsalek wrote.
"For this reason, while we continue to focus on sound financial management, we have made the difficult but necessary decision to make further cuts to position the company for long-term success."
FTX, once the third largest cryptocurrency exchange, collapsed in November following allegations of misappropriation of customer funds and a series of withdrawals. FTX founder Sam Bankman-Fried currently faces eight criminal charges and pleaded not guilty earlier this month.
Crypto.com did not specify how many people work for the company. His LinkedIn profile shows that he has only 4,660 employees.
As of Friday, Crypto.com's Kronos token was valued at $1.71 billion. During the session, it was up 5% to $0.0677. But like many cryptocurrencies, it is still far from its peak. The token value has fallen almost 93% from its all-time high in November 2021.
The broader cryptocurrency market also peaked in November 2021, crossing $3 trillion. But it fell to about $914 billion during the so-called cryptocurrency winter, which has seen pressure from the Federal Reserve and other central banks to reduce inflation, including rapidly raising interest rates.
Crypto.com says it is "growing ambitiously" in early 2022 to match industry growth.
"That trajectory is changing rapidly in light of adverse economic events," Marsalek said.
Crypto.com is part of a wave of layoffs in the cryptocurrency industry that has increased rapidly over the past year. Just this month, Coinbase announced it would lay off another 20% of its employees. Genesis slashed its workforce by 30% and Blockchain.com slashed its workforce by 28%. Overall, CoinDesk estimates that more than 28,000 crypto jobs have been lost.
TrueUp.io, a tech job marketplace, has added Crypto.com ads to combat layoffs in the wider tech sector. More than 29,000 people were laid off in 2023. Last year, more than 237,000 people lost their jobs in 1,517 company layoffs.
Crypto.com has more than 70 million users worldwide and "maintains a strong balance sheet," Marsalek said.