As cryptocurrencies continue their bearish downtrend over the past few months, numerous crypto firms globally are facing severe liquidity crises and a capital bleed-outs. Consequently, uncertainty looms over the job market in the crypto sector.
What Happened: As macroeconomic fears of an impending recession worsen, there is heightened fear, uncertainty, and doubt across the crypto market. Furthermore, the plunging cryptocurrency prices over recent months have caused several crypto firms to face downfalls.
Companies, such as Three Arrows Capital and Celsius Network CEL/USD, have faced extreme insolvency and illiquidity, alarming investors globally.
Coinbase COIN announced 18% hiring cuts and rescinded numerous job offers. Furthermore, other firms such as Gemini, laying off over 100 employees, and Crypto.com CRO/USD, cutting its workforce by 260 people, have also suffered from the downtrend in the crypto market.
At the same time, there are crypto firms that have announced new positions being offered. Binance BNB/USD has announced that 2,000 new positions are being opened for hire. Kraken has announced 500 new positions for hire. Polygon MATIC/USD has also posted 100 new positions open for hire. ConsenSys is also offering 125 new positions.
Why It’s Important: As large-scale institutional capital flowed into the crypto sector last year, numerous crypto firms deployed large-scale capital on advertisements and other expansionary measures. The Super Bowl 2022 saw millions of dollars spent by firms, such as Crypto.com, eToro, Coinbase, and FTX FTT/USD.
Such firms, that are now undertaking layoffs and capital pullbacks, represent the susceptibility and shortfalls that firms suffer when they are not cautious during a market uptrend. Such firms will find it harder to make it through such downtrends, due to a lack of running capital.
On the other hand, firms that are now undertaking expansionary measures, building infrastructure, and offering new job positions display how being cautious with spare capital during market uptrends, can benefit a company during downtrends.
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