Kraken, an exchange for cryptocurrencies, has said that it will lay off 1,100 people, or 30% of its staff. In a Tweet that has since been deleted, Binance CEO CZ warned users not to use platforms that “have layoffs.”
In a blog post on Wednesday, Kraken co-founder and CEO Jesse Powell said that the company is firing about 1,100 people to “adjust to current market conditions.” He said that the team size on the platform is back to where it was a year ago because of the cut.
Powell said that “macroeconomic and geopolitical factors” were to blame for the poor performance because they caused growth to slow down. He said that the recent drop in the market has led to less customer demand, less trading, and fewer new sign-ups.
“We responded by slowing hiring efforts and avoiding large marketing commitments. Unfortunately, negative influences on the financial markets have continued and we have exhausted preferable options for bringing costs in line with demand.”
Kraken is a cryptocurrency exchange that has been around since 2011. It is one of the biggest and oldest in the world. According to data from CoinGecko, it ranks 15th among centralized crypto platforms in terms of trading volume, with over $440 million in volume over the past day.
Since FTX went down, almost all centralized cryptocurrency exchanges have been hit by a wave of withdrawals. On the other hand, interest in decentralized alternatives has reached a record high, and the last couple of days have seen the most trading on decentralized exchanges.
Binance CEO Hints At Kraken Problems
The CEO of Binance, CZ, has hinted in a roundabout way that Kraken might be having trouble if it has to lay people off. In a now-deleted tweet, he said, “Beware of platforms that: 1. offer high APYs and/or 2. have layoffs.” “If you don’t deal with risks now, don’t blame other people for what happens later.
Crypto exchanges have started sharing their Proof of Reserves to reassure users. Nic Carter, a partner at Castle Island Ventures and the cofounder of Coinmetrics.io, which collects blockchain data, has found that five exchanges, including Kraken, Bitmex, Coinfloor, Gate.io, and HBTC, have finished their Proof of Reserves audits.
As of late, there have been more fights between the biggest crypto exchanges. Just a few days before, CZ attacked Coinbase by using some false information. In a tweet that has since been deleted, CZ made a big deal out of the Bitcoin holdings of Coinbase.
Coinbase CEO Brian Armstrong told CZ at the time, “If you see FUD out there, remember that our financials are public (we’re a publicly traded company),” and he sent a link to Coinbase’s Q3 shareholder letter.
