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Crypto Markets Could Be Hit by Polygon Layoffs: The Latest Round of Crypto Job Cuts

Last Updated February 2, 2024 11:06 AM
Teuta Franjkovic
Last Updated February 2, 2024 11:06 AM

Key Takeaways

  • Polygon shrinks workforce for efficiency.
  • Remaining employees receive bonuses across regions, replacing location-based pay models.
  • The tech sector is witnessing significant job cuts, exceeding Q4 2023 numbers in just one month.

Polygon Labs, the team dedicated to developing the layer-2 blockchain Polygon, has made the decision to lay off 60 employees, constituting approximately 19% of its workforce.

CEO Marc Boiron disclosed  this information in a post released on Thursday.

Polygon Labs Announces Layoff of 60 Employees, 19% of Workforce

Polygon stands as one of the prominent layer-2 blockchains specializing in Ethereum scaling solutions. It has facilitated more than 2.44 billion transactions, deployed over 1.17 million smart contracts, and achieved a sales volume of $12.8 billion, as per its website . Polygon Labs plays a crucial role in the expansion of the blockchain’s ecosystem.

Boiron explained  that the team’s rapid expansion during the recent crypto bull market had led to a dilution of the desired qualities in its workforce.

Boiron stated :

“To move as ambitiously and nimbly as possible where everyone is able to take ownership of what they’re doing, we must create an efficient surgical team, with significantly less bureaucracy. As a smaller team, we can collaborate more, expedite demanding projects and execute at our highest potential.”

Polygon Labs did not immediately respond to a request for comment.

Polygon Pays Up After Layoffs: 15% Raise for Staff, Geo-Pay Gone

Following the Layoffs, Polygon Labs Boosts Compensation by 15% for Current Employees and Abandons Traditional Geo-Pay Models

In the wake of recent workforce reductions, Polygon Labs has announced  a 15% increase in the overall compensation of its existing employees and a departure from traditional geo-pay structures. Those affected by the layoffs will receive a severance package equivalent to two months’ pay, along with continued health benefits through the end of the current month, where applicable.

CoinMarketCap data  indicates that Polygon’s token, MATIC, experienced a decline in value after the news but has since rebounded to approximately unchanged levels for the day.

This announcement comes on the heels of Jack Dorsey’s fintech company Block, which includes subsidiaries such as Square, Cash App, and Afterpay, also implementing staff reductions , affecting around 1,000 individuals or 10% of its workforce.

Tech Layoffs Explode in Q1 2024 – Is This the New Normal?

In the previous year, crypto firms including Ava Labs, OpenSea, Yuga Labs, and Chainalysis experienced layoffs during the fourth quarter, with OpenSea being the most significant, reducing its workforce  by 50% in early November, as indicated by the data.

The tech industry, encompassing both large and small companies, has witnessed substantial workforce reductions. In 2024, Layoffs.fyi   data shows that approximately 107 tech companies conducted layoffs, impacting nearly 30,000 individuals.

Remarkably, within this current quarter, the number of tech employees laid off has already exceeded the total for the preceding two quarters, and we are just one month into the four-month period.

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