Because of the recent FTX fallout and market contagions, Crypto.com has had to conduct its second round of layoffs. Crypto exchange platform Crypto.com has announced the layoff of approximately 20% of its global workforce.
In a Jan. 13 post, Crypto.com CEO Kris Marszalek stated that the exchange made the difficult decision to reduce its workforce in order to weather the current bear market.
Crypto.com’s workforce is expected to reach 4,000 by 2022. However, the company has been forced to conduct its second round of layoffs as a result of the recent FTX fallout and market contagions.
“The reductions we have last July positioned us to weather the macroeconomic downturn, but it did not account for the recent collapse of FTX, which significantly damaged trust in the industry,” Kris said.
As a result, Crypto.com has notified all affected personnel and will proceed with the distribution of their due allowances. Kris also stated that the exchange would work with relevant stakeholders to restore trust in the crypto industry as it seeks to expand globally.
Spending spree to firing spree
The bear market’s growing pains have forced Crypto.com to shift from being a heavy spender to firing its workforce. Crypto.com cut 5% of its workforce about seven months ago. As a result, approximately 260 employees were laid off.
However, speculations in the crypto community suggest that the exchange’s financial problems may be the result of excessive marketing spending.
The company spent approximately $100 million on the famous “Fortune Favors the Brave” marketing campaign. Furthermore, a 30-second Super Bowl commercial starring LeBron James costs around $7 million.
In addition, Crypto.com spent approximately $700 million to acquire the naming rights to the Staples Center, as well as another $400 million to complete six sports deals.
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