Luno, a cryptocurrency exchange owned by Digital Currency Group, announced a large round of job cuts on Wednesday.
The layoffs will affect 35% of Luno’s total staff, CEO Marcus Swanepoel announced in a statement on the crypto exchange’s website. They come after what Swanepoel described as “an incredibly difficult year for the broader tech industry and the crypto market in particular.”
In the past year, some popular cryptocurrencies have seen a sharp drop in prices. Bitcoin, for example, is down nearly 39% over the past 12 months, while Ethereum and Solana are down about 37% and 74%, respectively.
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The “turbulence,” according to Swanepoel, has impacted Luno’s “overall growth and revenue,” leading to layoffs and other measures.
He cited “a number of unforeseen and very extreme events,” including a “global economic downturn,” “an even bigger downturn in the tech sector as a whole,” a “crypto winter” and recent events in the crypto industry that hurt it. One of the “shocks” was the recent rapid crash of the FTX exchange.
FTX has been involved in Chapter 11 bankruptcy proceedings since filing for bankruptcy several months ago. In connection with the firm and its sudden collapse, founder and former CEO Sam Bankman-Fried has since been hit with a slew of criminal charges to which he has pleaded not guilty.
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Such events “in turn [have] affected us indirectly in a number of ways: on the capital side, a significantly tighter funding environment, with a shift in market focus from long-term investment to shorter-term returns, and on the operational side, a negative impact on market sentiment and therefore on growth and revenue for our business, along with all of our peers and competitors,” Swanepoel told employees.
Luno’s customers and operations were not affected, according to the CEO.
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Other companies in the industry have recently made announcements to reduce their workforce after a bumpy year for crypto.
Crypto.com revealed plans to lay off 20% of its workforce in mid-January. Earlier in the month, Coinbase said 20% of its workers would be laid off.
In late November, Kraken cut about 1,100 jobs.