Also a victim of the current harsh crypto winter, the crypto exchange Kraken has announced the layoff of 1100 people, or 30% of its staff.
The recent bankruptcy of the FTX empire has compounded the situation by prompting users of crypto trading platforms to withdraw their funds in order to keep them safe on Ledger Nano X-type crypto wallets.
In a post on Kraken’s blog titled “Kraken Takes Action to Weather Crypto Winter,” the company’s CEO Jesse Powell explained why these layoffs are necessary:
“Today, we are announcing one of Kraken’s most difficult decisions to date. We are reducing our global workforce by approximately 1,100 people, or 30 percent, in order to adjust to current market conditions.
We are extremely grateful for the contributions of those affected by today’s announcement and will do our best to help them move on to their next opportunity. All impacted Krakenites were notified this morning.
Kraken, to ensure survival during this bear!
Over the past few years, hundreds of millions of new users have entered the crypto space and millions of new customers have trusted Kraken during that time. We have had to grow rapidly, more than tripling our staff in order to provide these customers with the quality and service they expect from us. This reduction brings our team size down to what it was just 12 months ago.
Since the beginning of this year, macroeconomic and geopolitical factors have weighed on the financial markets. This has resulted in significantly lower trading volumes and fewer client sign-ups. We have responded by slowing down recruitment efforts and avoiding large marketing commitments. Unfortunately, the negative influences in the financial markets continued and we exhausted preferable options to align costs with demand.
As one of the oldest global crypto exchanges, founded in 2011, we have successfully navigated many market cycles and our strategy has always included thoughtful cost and expense management. These changes will allow us to sustain the business for the long term while continuing to develop world-class products and services in selective areas that add the most value for our customers.”
Like many other companies in the industry such as NYDIG, Robinhood, Coinbase, Bybit, Huobi, Bitpanda, CoinFLEX, Blockchain.com, OpenSea, Banxa, Compass Mining, or Gemini , Kraken is also being forced to lay off staff en masse in order to ensure its survival during this bear market crypto that is taking hold.