According to the most recent CoinGecko report, despite major setbacks in the crypto industry, layoffs from crypto companies still only constituted 4% of total technology layoffs. However, the number of crypto layoffs in January 2023 skyrocketed by over 12 times the yearly average, accounting for 41.1% of the total layoffs in 2022.
The report highlights that companies in the consumer and retail sectors continue to be heavily impacted by technology industry layoffs in 2023.
6/ Layoffs from crypto companies maintained at 4% of technology layoffs, despite major fallouts.
— CoinGecko (@coingecko) February 1, 2023
That said, the number of crypto layoffs in January 2023 surged by over 12 times the average in the past year, amounting to 41.1% of 2022 levels. pic.twitter.com/uBkn0DWKfE
The Terra Luna crash in May 2022 had significant impacts on the cryptocurrency market and industry, affecting major players like Three Arrows Capital, Voyager, and BlockFi. The crash led to a surge in crypto layoffs, reaching a record high of 3,003 in June, 13.4 times higher than the average monthly rate.
The collapse of FTX, Sam Bankman-Fried’s cryptocurrency exchange, in November 2022 added further pressures, laying off 1,805 employees, 8 times the average monthly rate. Most retrenchments came from centralized cryptocurrency exchanges, accounting for 82.2% of the total.
As reported by CoinGecko, the number of crypto layoffs decreased to 649 in December 2022, possibly due to companies avoiding layoffs during the holiday season. However, this still represented a nearly three times higher number compared to the average monthly rate. Cities such as San Francisco, Dubai, and New York were heavily impacted by crypto layoffs in 2022.
It’s worth mentioning that layoffs in crypto rose again in January 2023, reaching 2,806, a 12.5 times increase over the average monthly rate, making it the second-worst month for crypto layoffs. Centralized crypto exchanges accounted for 84.8% of these reductions due to declining trading volumes and revenues.
The January 2023 layoffs alone accounted for 41% of the total layoffs in 2022, suggesting 2023 layoffs may surpass last years due to the crypto bear market and economic conditions.
CoinGecko notes that despite recent high-profile crypto layoffs, the number of crypto job cuts so far this year is in line with the overall trend in technology layoffs.
In 2022, crypto made up 4.3% of tech layoffs and was ranked 10th, and this remained relatively unchanged in 2023, with crypto accounting for 4.0% of tech layoffs in January and still occupying the 10th place based on overall numbers.
