The crypto bear market has begun, and it seems that even popular exchanges are having a tough time dealing with it. In the past few months, we had a lot of small platforms laying off their workforce to cut expenses. However, this time, Gemini aims to reduce operational costs as it lays off 10% of its employees. The co-founders of the exchange, Cameron Winklevoss and Tyler Winklevoss said that the ‘turbulent market conditions’ are the main reason for this, and it’s going to last for a while.
Gemini lays off 10% of its employees
The crypto exchange is offering a separation package and healthcare benefits to the workers it’s laying off. They will also inform each employee who was laid off personally, so their privacy is maintained. Gemini says it will ensure to treat of the affected ones with respect. However, the problem is more significant than this. If exchanges need to fire employees every time there is a bear market, it won’t be a perfect situation for the industry.
Gemini’s co-founders explained the situation by saying that crypto is in a phase where we will see hypergrowth followed by contractions like these. But ultimately, the equilibrium will be above where it was the last time.
Most exchanges are cutting corners
While some platforms are laying off employees, many are reducing their hiring spree, like Coinbase. A while back, Bitso laid off 80 employees, which was 10% of its workforce. We also had Robinhood cutting down its workforce by 9%. All this shows the huge impact this bear market is having on these platforms. The exchanges that are retail-driven are affected the most. The sad reality is most retailers start to buy when we are already near the top, and they are fearful when the markets are bleeding.
Some exchanges are taking an alternative approach to this situation. For example, FTX is trying to diversify its business by offering equities trading to reduce the risk of totally depending on crypto. Platforms catering to institutional investors are also not facing much of a problem. Take Fidelity’s digital asset arm that is continuously hiring to meet the increased institutional demand.
What are your thoughts as Gemini lays off 10% of its employees due to market conditions? And do you think exchanges must find some other way to deal with these situations? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.