The crypto industry says it wants to transform traditional finance and its practices, but it lags behind on one of its biggest legacy issues: transparency.
And one of the biggest players in the cryptosphere has just shown that without transparency, the industry will not gain the trust of the general public and investors.
Job cut background
Crypto.com said in June it would cut 260, or 5%, of its jobs in an effort to cut costs amid the cryptocurrency crash.
At the time, the crypto market had lost more than $2 trillion from its all-time high of $3 trillion reached last November amid investors’ cryptomania.
“It means making difficult and necessary decisions to ensure continued and sustainable long-term growth by making targeted reductions of approximately 260 or 5% of the company’s workforce,” Crypto.com CEO Kris Marszalek tweeted on June 10.
To adapt to the new situation, all crypto companies downsized. From Coinbase (COIN) to Gemini, almost every platform except Binance.com cut jobs, withdrew job offers already made to candidates, and froze hiring.
The so-called crypto winter, the period of continuously falling digital currency prices and a liquidity crisis affecting prominent crypto borrowers had continued until recently, when prices stabilized.
The platforms appeared to have finished cleaning.
Much more than we thought
But now we learn that Crypto.com, whose most famous ambassador is actor Matt Damon, has quietly carried out hundreds of additional cuts.
According to Decrypt and The Verge, the platform has cut about 1,000 more jobs since then. During an all-hands with employees on Aug. 10, Marszalek announced additional job cuts but declined to specify the exact number, reported The Verge, which obtained a recording of the meeting.
“Due to the lack of internal transparency, one can only estimate the scale of this round of layoffs: we increased our staff by ~50 percent since 2021, and almost all of them were hired to drive growth. Now it appears that these additional ~1,300 employees will be seen as costs to be reduced, to save the business, a source told The Verge.
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“The company is cutting back to the bare minimum to survive the likely long bear market – internal initiatives are about trying to save every penny,” a source told Decrypt.
“We have a strong balance sheet”
Crypto.com has been pushing for mainstream crypto adoption through massive TV and social media ad campaigns with Damon.
Before the job cuts, about 45% of Crypto.com employees were hired in 2020 and 2022.
Crypto.com confirmed to TheStreet that it has continued to reduce its size, but did not provide a number. The company also insisted that its refusal to specify the extent of the cuts did not say anything about its financial situation. Crypto.com claims to be in good financial health.
“We announced reductions in June, and since then have been optimizing our workforce to adapt to today’s external economic headwinds,” a Crypto.com spokesperson told TheStreet in an emailed statement.
“We have a strong balance sheet and will continue to invest in product, engineering and brand partnerships going forward,” the spokesperson added.
Reviews on Glassdoor
Crypto.com, which is based in Singapore and claims 50 million users, is not a public company and does not have to publicly report its financial results.
This situation surrounding the firm, which was founded in 2016, has given rise to speculation about its financial strength. This is especially so after prominent crypto lenders Celsius Network and Voyager Digital recently filed for Chapter 11 bankruptcy protection.
Former and current Crypto.com employees have criticized the lack of transparency in reviews on Glassdoor.com.
“Lack of transparency and job stability,” a “current” employee posted on July 10. “The company is hiding the fact that it has laid off more than 1,000 employees, although it officially announced to lay off 260.”
“They’ve removed the corporate directory so we can’t see the numbers going down. Management has been silent on the issue and everyone is terrified that their job will be next. It’s not good for morale to see that 1/3 of the invite list at your next meeting are disabled accounts,” the employee added.