Even though the full effects of FTX’s collapse are still being felt, some have already issued a warning that there would be more layoffs “in the months to follow.”
Recruitment experts have warned that FTX’s collapse and any subsequent one may lead to layoffs at crypto companies in months ahead.
According to a survey released on November 14 by cryptocurrency data aggregator CoinGecko, as of November 13, 4,695 employees in the crypto industry have already been let go in 2022, representing 4% of staff reductions across all “technology startups.”
However, the report’s authors issue a warning that the “major effect” of FTX’s abrupt collapse could result in an increase in crypto layoffs in the upcoming months:
“In the months to come, there may be more cryptocurrency layoffs due to the fall of FTX after November 2 and its ongoing effects on the industry.”
Neil Dundon, the creator of CryptoRecruit, mentioned that although FTX’s activities would result in some layoffs, the general trend that crypto acquisition follows crypto pricing hasn’t changed.
“Layoffs have consistently followed the same general trajectory as cryptocurrency pricing. FTX, although being a horrible occurrence, hasn’t altered that general trend”, he continued, adding:
“There will be layoffs as a result, but it will give strong projects a chance to nab good people, which we are gathering.”
The founder of the recruitment agency Proof of Search, Kevin Gibson, was less upbeat. He revealed that one of his candidates, who was scheduled to start work today, had his offer “pulled” during the initial call with the employer.
The FTX collapse is “changing every day,” according to Gibson, making it difficult to predict how it will play out, but he added that his candidate’s experience “will not be an isolated incidence.”
Due to the market downturn, businesses in the crypto sector have already made a number of layoffs this year.
One of the most recent staff reductions in the sector involved the layoff of 1,000 workers at payment processor Stripe.
Another involved a 22% reduction at blockchain developer Dapper Lab and a 10% reduction at venture capital company Digital Currency Group. Early in November, all layoffs were implemented.
A 20% decrease on Nov. 1 was also reportedly in the works for the virtual asset-focused investment company Galaxy Digital.
According to Yahoo Finance, Coinbase is said to have laid off another 60 employees on Nov. 10.
The previous CoinGecko analysis, published on November 4, examined the cities where layoffs in the bitcoin industry were most prevalent.
San Francisco, which is home to Silicon Valley, one of the biggest centers of invention and technology in the world, came in first, followed by New York City, Dubai and Singapore.
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