Increasing Casualties as Crypto Winter Continues: Kraken To Sack Over 1,000 Workers

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Last Updated on December 1, 2022 by Bitfinsider

The third-largest exchange in the world by trading volume, Kraken, announced that it would reduce its workforce by 30% to address the current market conditions. The San Francisco-based corporation has specifically laid off 1,100 workers.

The FTX scandal added fuel to the fire by driving the price of Bitcoin to a two-year low at a time when the cryptocurrency market was already experiencing a protracted winter. Although the collapse of the crypto exchange prompted governments around the world to tighten regulations and launch investigations into various platforms, lower cryptocurrency prices also forced cryptocurrency companies to reduce their staff in order to survive the bear market.

Kraken’s co-founder and CEO, Jesse Powell, wrote in a blog post that the platform tripled its staff during the previous bull market to provide a seamless experience for its users. But regrettably, the market downturn forced the company to restore its headcount to where it was a year prior.

The CEO remarked: “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.”

Kraken Cuts Staff in Order to Sustain Business Over the Long Run

While the major crypto companies are declaring bankruptcy, lower cryptocurrency prices and the US Federal Reserve’s plan to tighten regulations have caused investors all over the world to sell off hazardous assets. It also decreased the amount of new sign-ups and trading volume at Kraken. To combat the bear market, the exchange restricted hiring and postponed significant marketing commitments before deciding to reduce its personnel workforce.

A few months ago, Kraken asserted that the platform intended to hire 500 new workers during the bear market to provide skilled staff for its crypto-first culture. On the other hand, at the time, other businesses were laying off employees. But it appears that things change as the circumstances change.

Previously, Kraken stated: “We have not adjusted our hiring plan, and we do not intend to make any layoffs. We have over 500 roles to fill during the remainder of the year and believe bear markets are fantastic at weeding out the applicants chasing hype from the true believers in our mission.”

Kraken continued by saying that it was the platform’s sole remaining feasible means of long-term business sustainability. It will also have the ability to create “world-class products and services in selective areas that add the most value for our clients.”

Kraken’s job cuts match with personnel reductions at other cryptocurrency businesses this month as a result of the bear market. They include Unchained Capital, which parted ways with 600 team members, and Coinbase, which cut 60 roles.

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