• Wed. Feb 8th, 2023

Crypto.com lays off 20% of workforce after FTX collapse blunted ambitious growth

BySwanzi010

Jan 16, 2023

The exterior of Crypto.com Arena on January 26, 2022 in Los Angeles, California.

Rich Fury | Getty Images

Crypto.com announced Friday that it’s laying off 20% of its workforce. CEO Kris Marszalek said in a blog post that the crypto exchange grew “ambitiously” but was unable to weather the collapse of Sam Bankman-Fried’s crypto empire FTX without the further cuts.

“All impacted personnel have already been notified,” Marszalek said in a post.

The company has 2,450 employees, according to PitchBook data, suggesting around 490 employees were laid off. A Crypto.com representative was not immediately available to comment.

Crypto exchanges and lenders have been forced to aggressively pare back head count, a move accelerated by the FTX collapse and the wave of crises that have followed.

Marszalek said the reduction was part of Crypto.com’s continued focus on “prudent financial management.”

Like FTX, Crypto.com entered into high-profile promotion deals and sponsorships, signing an eye-popping naming deal for the former Staples Center in 2021 that’s valued at $700 million over 20 years. The arena is home to the NBA’s Los Angeles Lakers.

“We have a significant year ahead of us as we continue to help restore trust in our industry,” Marszalek wrote. Marszalek founded Singapore-based Crypto.com in 2016, overseeing a company that reportedly reached at least $1.2 billion in revenue by 2021.

Crypto.com had a bruising 2022. High-profile gaffes included multiple mistaken transfers, one of which accidentally transferred over $400 million worth of assets to another exchange. The company also laid off some employees in 2022.

In December, CNBC reported on some of Marszalek’s business successes and failures. At the time, Marszalek dismissed concerns about Crypto.com’s stability.

“Startups are hard … but there is no better way to live,” he wrote.

Source : Sky.com

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