Consensys and dYdX announce massive layoffs despite rising prices (Photo by Bench Accounting on Unsplash)
Key Takeaways
- Consensys and dYdX laid off 20% and 35% of staff, respectively, despite bullish market conditions.
- Regulatory pressures and structural changes drive the unexpected cuts in the crypto industry.
- The layoffs highlight the hidden struggles of crypto companies amid rising prices and investment.
Two major crypto firms, Consensys and dYdX, announced major layoffs on the same day despite the current bullish market conditions.
Crypto layoffs are common during bear markets, as dwindling asset prices lead to funding shortfalls and financial constraints. However, two major layoffs in a single day—despite Bitcoin nearing a new all-time high—signal a deeper cause for concern.
Consensys Cuts 20% of Workforce, Citing SEC Struggle
Consensys, the company behind the popular decentralized crypto wallet Metamask, slashed its workforce by 20% on Oct. 29, axing 160 employees across all divisions.
According to Consensys founder and CEO Joe Lubin, the layoffs are a direct result of the company’s ongoing legal battle with the Securities and Exchange Commission (SEC).
Lubin took to X to express his frustration with the regulatory body, accusing it of abusing its power and stifling innovation.
“Multiple cases with the SEC, including ours, represent meaningful jobs and productive investment lost due to the SEC’s abuse of power and Congress’s inability to rectify the problem,” he wrote.
Consensys’s lawsuit against the SEC, filed in April , challenges the regulator’s jurisdiction over cryptocurrency companies.
dYdX Announces 35% Layoff, Citing Structural Change
On the same day, decentralized crypto exchange dYdX announced a 35% layoff, affecting more than a third of its staff.
In a blog post titled “Letting Go,” CEO Antonio Juliano described the decision as “incredibly difficult and sad.”
While Juliano didn’t provide a clear reason for the layoffs, he hinted at a structural reorganization, stating that the company needed to adapt to its new reality.
“The decision to let go was a realization that the company we’ve built is different from the company dYdX must be,” he wrote.
Juliano’s return to the CEO position after a six-month hiatus suggests that the company is looking to restructure and refocus.
His earlier blog post, titled “The Return,” hinted at a more hands-on approach, with the CEO taking the reins to guide the company forward.
A Warning Sign for the Crypto Industry?
The Consensys layoffs demonstrate the crippling effects of regulatory overreach, while dYdX’s restructuring raises questions about the company’s ability to adapt to changing circumstances.
As the crypto industry continues to grow and mature, it faces increasing scrutiny from regulatory bodies and shifting market conditions.
The layoffs at Consensys and dYdX serve as a reminder that even in the best of times, companies must be prepared to adapt and navigate the challenges that come with operating in this complex and rapidly evolving space.
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