South Korea’s largest Bitcoin exchange, Bithumb, has announced layoffs of 50%, the latest casualty of “crypto winter.” B
A report in Korean media issued earlier today shows that the exchange will be cutting its staff from 310 to around 150. The exchange is currently ranked at no #2 in trading volume in the world by Coinmarketcap and has a 24/h volume of over $1.5 billion.
A company spokesperson claimed that most of the employees being let go had already wanted to leave.
Voluntary retirement is part of our support program for former employees and is intended to provide assistance and training for job placement.
Apart from that, [Bithumb’s] trading volume has decreased compared to the previous year, [so] we are trying to provide internal measures. We will continue to add necessary personnel for various new businesses.
Decreased trading volume and a corresponding lack of fee revenue are the cause of the layoffs, an all-too-familiar sight in the cryptocurrency industry of late.
Bithumb has been suspected more than once of faking its volume. If it had the volume it claims, its income would be more than sufficient, even throughout the crypto winter.
Bithumb joins other heavy hitters such as Dash, Steemit, ConsenSys, and Shapeshift in laying off large amounts of staff. Dash
Steemit cut 70% of staff in an extreme measure to keep the company afloat after the cryptocurrency price crash tanked the value of Steem tokens. The currency is the lifeblood of the social media platform, and the company admitted that it was over-dependent on its token valuation.
Eric Voorhees of the trailblazing ShapeShift exchange also stated that his company was overly-reliant on the price action of cryptocurrency, with a significant amount of company assets tied up in the market. He cited crypto winter as the main factor behind layoffs of around 30%, also adding that ShapeShift tried to expand too quickly and deviated too far from its original mission to provide crypto trading services.
Ethereum co-founder Joe Lubin was also forced to drop 60% of staff, announcing that ConsenSys would have to terminate staff and also begin dropping projects not turning a profit.
With the largest companies in the industry taking massive hits, it seems that none are safe from what continues to be an ongoing problem. The volatility of cryptocurrency has been both a blessing and a curse for exchanges like Bithumb. It attracts traders seeking to capitalize on massive price swings while, at the same time, providing a foundation so shaky that many promising companies cannot build upon it.
For now, all they can do is attempt to weather the storm and hope that it passes quickly. For many, this means seeking funding and selling large parts of the company off to venture capitalists who may end up changing the original plans laid out by the hopeful founders.
Last modified: June 12, 2020 11:12 AM UTC