Crypto is chaotic on its best days, but this week saw a global descent into panic as crisis after crisis hit those invested in the sector.
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Firings
As prices of crypto currencies tumbled, employees of prominent crypto exchanges were laid off. Coinbase CEO Brian Armstrong admitted that the company had hired too many people as Bitcoin’s price rose to an all-time high to over $67,000 in 2021. But with prices falling since then, Armstrong said employee costs were too high in an “uncertain market.” The result: about 18% of Coinbase’s global staff members, including 8% of its employees in India, were shown the door.
Other large crypto exchanges, including BlockFi and Crypto.com, also announced plans to cut jobs.
Coinbase shared a ‘Talent Hub’ for affected employee to list their qualifications to find new roles.
The hub had 648 profiles as on June 17, and most employees were based in North America, followed by workers in Asia Pacific region. The two worst-hit departments were engineering, with 293 candidates listed, and customer experience & support, with 218 candidates.
The Hindu reached out to Indian employees who had been laid off by Coinbase. One declined to comment, citing confidentiality obligations.
Many of next week’s crypto headlines will hinge on whether or not Bitcoin manages to stay above $20,000.
Freezing
A now notorious decentralized finance (DeFi) platform called Celsius decided to freeze all withdrawals and transfers, citing “extreme market conditions.”
As the crypto lending platform’s users worldwide reacted with outrage, Celsius’ actions showed how those investing in so-called decentralized systems can be impacted for life by centralized company structures. This move came just a day after Celsius CEO Alex Mashinsky dismissed claims that users couldn’t pull out their funds.
However, this isn’t Celsius’ first brush with negative press, as the platform reportedly lost funds in a past DeFi hack. Celsius was also hit with a cease-and-desist order in New Jersey, USA.
Now, the DeFi platform’s latest freezing of withdrawals is also being investigated by multiple American state regulators.
Falls
Crypto events don’t happen in a vacuum, since incidents as common as celebrity tweets can send prices rocketing or spiraling. As the Celsius crisis unfolded, Bitcoin fell from a price of around $30,000 on June 10 to $20,982.15 on June 17. In the meantime, Ethereum’s Ether dropped from around $1,773 on June 10 to slightly above $1,102 on June 17. For most of the week, the market was in a state of extreme fear.
As the top two cryptocurrencies by market cap approach critical price points, investors are bracing for quick changes and panic selling. Prices such as $20,000 and $1,000 are psychological prices due to their milestone status, so there is a chance of investors setting up bots to conduct automatic trades at these levels.
