Another Crypto Company Dismisses 40% of its Employees to Survive the Bear Market

Octopus Network – a multichain crypto network supporting Web3 applications – will lay off 40% of its staff members to ensure its survival amidst the ongoing crypto winter.

The adverse macroeconomic factors have taken their toll on numerous other industry leaders who took similar action over the past several months. Some examples are Coinbase, CryptoCom, Huobi, Bybit, BitMEX, and others.

This Winter is Different Than the Others

In a recent letter, Louis Liu – Founder of Octopus Network – announced that they will refactor the team to cope with the unfavorable market conditions. He also argued that the present bear market is somewhat different than the previous ones:

“The current winter is the third winter I’ve experienced, the first two being 2014–2015 and 2018–2019 — and I see that this winter is very different from the others.”

Liu believes that crypto will be among the most affected industries, where high risks and enhanced volatility will continue to reign. He also thinks that the majority of Web3 startups will not endure the challenging times, predicting the negative trend will last for at least another year.

As such, Octopus Network (which supports the development of Web3 blockchain applications) enforced its “Voluntary Separation Program” and will dismiss 40% of its total workforce. In addition, the 18 people left will have to agree on a salary-cut deal:

“So, we’re moving forward with the Voluntary Separation Program. To date, roughly 40% of the members (12 of 30) will leave the core team through the program. The remaining team members will accept a 20% salary cut, and the team token incentive will be suspended indefinitely.”

Near Foundation is the “exclusive strategic investor” and “mother-chain” of Octopus Network. Liu said the partnership between the two entities remains strong, adding that NEAR and IBC will become the “two cornerstones” of Octopus’ new strategy.

2022: a Year of Dismissals and Bankruptcies

Multiple cryptocurrency companies trimmed the size of their divisions, prompted by the market downturn and the decreased interest in digital assets. 

The leading US-based exchange Coinbase laid off 18% of its employees in June, BlockchainCom dismissed 25%, while the NFT marketplace OpenSea parted with 20% of its employees.

Companies, including the Argentinian cryptocurrency platform Lemon Cash and the Aussie trading venue Swyftx, went even further, dismissing respectively 38% and 40% of their staff members.

The past several months also saw many firms unable to cope with the turbulence and eventually halting operations or filing for bankruptcy protection. Such examples are the former giants Celsius Network, Three Arrows Capital (3AC), Vauld, Core Scientific, and others.