An ongoing bear market combined with wider global economic struggles has hit crypto firms hard, causing delays, staff layoffs, and AI pivots.
This week, crypto protocol Algorand announced it was reluctantly reducing its workforce by 25%.
Algorand claimed the “tough” layoff was in response to “the uncertain global macro environment as well as the broader downturn in crypto markets.”
Indeed, as the year continues, bitcoin’s price is struggling to gain upward momentum after dropping to $63,000 in late February.
The escalating war between the US, Irael and Iran is also causing the price of oil to rocket, and threatens deeper economic turmoil across the globe.
Crypto layoffs, cuts, and delays
Firms including Gemini, Messari, Crypto.com, OP Labs, OpenSea, and Kraken, have announced various cuts to their operations, be it through trimming staff or delaying planned operations.
Meanwhile, Crypto.com announced a 12% staff layoff yesterday while citing an AI pivot. The firm’s CEO, Kris Marszalek, claimed the roles of the fired staff “do not adapt in our new world.”
Read more: Mass crypto layoffs are a short-term solution with long-term consequences
Gemini similarly let 25% of its staff go in February, claiming AI has allowed its workforce to operate more efficiently with fewer staff.
Gemini also let three of its execs go, including Chief Operating Officer Marshall Beard, Chief Financial Officer Dan Chen, and Chief Legal Officer Tyler Meade.
On Monday, crypto analytics firm Messari announced that it’s “doubling down” on becoming an “AI-first company,” and announced that it had let various team members go as new CEO, Diran Li, took the reins.
Protocol contributor OP Labs fired 20 of its staff last week in a memo that also alluded to the possibility of an AI pivot. CEO Jing Wang said, “This is about doing fewer things well, making decisions faster, and reducing coordination overhead.”
These all follow what was one of the more dramatic AI pivots from Jack Dorsey’s Block, which fired 50% of its staff (around 4,000 people) while citing the advancements AI offers to workplace efficiency.
Read more: How bombing Iran shifted oil and bitcoin prices
This week, the NFT platform OpenSea announced that it was delaying the launch of its $SEA token because of “challenging” market conditions across crypto that may affect its launch.
Another delay was announced yesterday to Kraken’s initial public offering (IPO). According to sources familiar with the matter, Kraken’s parent company, Payward, is pausing the IPO plans until “market conditions improve.”
Layoffs often come with reputational costs and further long-term consequences down the line, as staff are left burdened with the workloads of their departed teammates.
However, with more companies citing AI as a reason for workforce reduction, it’s hard to ignore its ability to mitigate the burden of cutting staff.