Blockchain companies under the outbreak: layoffs, pay cuts, and closures

Nor can decentralization ward off the side effects of the epidemic's spread. As the overseas epidemic intensified, the global economy was not optimistic, and bitcoin also suffered a heavy hit on March 12, a one-day drop of more than 40%. In this case every business is more or less affected. A number of blockchain companies have announced layoffs or pay cuts, and some have even closed their doors.

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Big wave survival, redundancy + pay reduction has become the company's standard

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At present, the three major overseas blockchain analysis companies, Chainalysis, Elliptic, and CipherTrace, have announced layoffs recently, hoping to become survivors of the global war by increasing revenue and reducing expenditure.

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Elliptic, which is based in London and has raised $40m since its inception in 2013, has just completed a $500 investment from Wells Fargo Strategic Capital. But $5 million doesn't seem to be enough to support their negative assessment of the overall economy.

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James Smith, Elliptic's chief executive, said the company had cut a combined 30 per cent of its jobs in the us and UK. He said: "this is an era of unprecedented, we expect that 19th global influenza pandemic will lead to severe global economic recession. After careful consideration, Elliptic made a difficult decision: to cut our global workforce. Through rapid restructuring of our team, we are in a sustainable, high-growth business foundation."

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In its latest filing at Companies House, Elliptic's net loss for the year ended March 2019 widened from a net loss of 2.3 million pounds ($2.8 million) in 2019 and 1.97 million pounds ($2.45 million) in the year ended March 31, 2018.

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Elliptic is not alone. Chainalysis, another data analytics firm more familiar to Chinese cryptographers, also decided to cut pay. "We plan to temporarily take a 10 per cent pay cut between may and the end of the year [under local law where we have staff]," says Madeleine Kennedy, the agency's director of communications. "We hope for the best, but we also prepare for the worst, so between now and January we will continue to reassess the market and hope that these actions may be temporary."

But the planned pay cut won't apply to all workers, including those earning up to $75,000 and new hires who recently signed contracts. Even before Chainalysis's pay cut, about 40 workers left the company in November.

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CipherTrace, another major blockchain analysis company, is also laying off staff. A CipherTrace spokesman acknowledged that "most" of the job cuts were in sales and marketing. CipherTrace is understood to have laid off 10% of its staff. A CipherTrace spokesman said the layoffs were due to the outbreak changing the way they do their jobs. "There are no more face-to-face sales meetings, and sales and marketing trade shows are expected to be canceled by the end of 2020. It's time for us to tighten our belts to weather the coronavirus storm." But for the company, downsizing didn't seem like a bad thing, and customers began to learn how to communicate and do business through Zoom and other online methods. Reducing expenses on business trips, brochures, etc., can greatly increase cost effectiveness.

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Capital is not immune

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And usually high on the capital, in front of the market is not so strong. Even warren buffett, after a high-profile "bottom-hunting" of American airlines, couldn't help but cut delta's losses by nearly 50% on April 3rd. "I am greedy when others are fearful, and I am fearful when others are greedy."

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Wall Street's monsters are still like this, and the capital of the encrypted world is a drop in the ocean.

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Pulse reported in February that Galaxy Digital, a cryptocurrency commercial bank founded by billionaire Michael Novogratz, had laid off 13 people, or about 15% of its workforce. The cuts were made in full in early January.

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Also in February, ethereum ventures consensys&fung; It also announced a major restructuring of its business, separating its software development and investment divisions and laying off 14% of its workforce. In December 2018, the company announced 13 percent layoffs. In April, consensus will cut "more than 90" jobs.

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A company spokesman said: "the global COVID - 19 pandemic have health and life of the world had a profound effect. ConsenSys carefully analyses the business relationships with the global situation. Like most peers, the company has seen the great uncertainty of the market, companies to adjust the priorities, and to review the schedule." "We have retained all key operational aspects of our business to ensure the development and service of key products and solutions," the company said in a statement. The affected workers will receive two months 'severance pay and career-change services, ConsenSys said.

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In April, Cambrial Capital, a U.K. compliant cryptographic investment fund with $6 million to $10 million in assets under management, was also scaling back due to the outbreak and the market crash on March 12.

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Close the business

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Wage cuts, layoffs and downsizing could still leave companies lurking under the winter ice, waiting for the market to pick up. Some companies and projects may not have had the same luck.

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On February 23, Zcash Community Chat shut down its service due to "increased costs and reduced usage".

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On February 26th CoinMex, the digital asset trading platform of huoyuan eco-investment, announced the closure of its business.

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On March 12, Adaptive Capital, a cryptographic hedge fund, was forced to close after "taking a major hit" due to the sharp drop in bitcoin prices. & have spent Adaptive blamed "inadequate infrastructure" for its inability to respond appropriately to the sell-off. Adaptive had accounts on BitMEX and those accounts were liquidated, the source said. During the price crash, BitMEX was down for about 45 minutes. BitMEX said it had "hardware issues" at its cloud service provider.

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On March 17th Sparkswap, a decentralised trading platform backed by Pantera Capital, closed. Sparkswap founder Trey Griffith wrote in a post that the team announced the closure of Sparkswap because there were not enough users to keep the business going, and because it was too difficult to set up a currency channel and too few hosts to keep the business going.

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conclusion

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In the age of the great wave and the great sand, risks and opportunities coexist. Tough markets are not bad for truly valuable companies. The cryptographic industry has long been known for its rapid changes, with bitcoin up 90% from its historic low of $3,800, and strong advocates like BitMEX CEO Arthur Haye still believe it can reach $20,000 by the end of the year. Also like warren buffett, the old-money behemoth has consistently said that bitcoin is "probably the square root of the rat poison." Of course, in the wake of the market crash, the pulse has found more than once that former believers have faltered. Galaxy Digital's founder, Michael Novogratz, who has been a bitcoin stalwardsman, reiterated his belief that bitcoin will explode in 2020 in an interview. But he also said he might abandon bitcoin if its price did not hit a new high this year.

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The planet has survived generations of life, and the cryptographic market is still there, with waves of bitcoin trading in and out of the loop. The crypto market is getting bigger, and ecosystems are flourishing. For the industry, March 12 is like this outbreak, no matter how difficult the process, believe that we can make it through in the end.

This article has been compiled and written by rhythm BlockBeats.https://www.theblockbeats.com/news/15947

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