Bitpanda is cutting almost 30% of its workforce, citing risk of recession

Bitpanda is cutting almost 30% of its workforce, citing risk of recession

Bitpanda is laying off about a third of its workforce as the company tries to navigate a period of turbulent markets and uncertainty.

The Peter Thiel-backed cryptocurrency exchange said in a Letter to employees that it plans to cut its workforce from more than 1,000 to 730, citing the need to improve its financial health against the impact of an expected recession.

“In recent months, market sentiment has changed dramatically, fueled by geopolitical tensions, rising inflation and worries about the impending recession,” Bitpanda said in the letter.

“There is a lot of uncertainty in financial markets right now and while we know the industry is cyclical, no one knows when market sentiment will change.”

Bitpanda admitted to facing challenges in keeping up with the growth of the crypto industry. The company also said it has withdrawn new offers because the positions it was previously hiring for are no longer available. It now plans to focus on security and compliance, user experience, education and community.

“Move fast and break things” has been the motto of many companies looking to adapt [in] the Web3 space, Sheraz Ahmed, managing partner at STORM Partners, told Blockworks. “Now we can’t be surprised if the latter happens after the former,” he said.

The Vienna-based firm joins a number of other crypto firms trying to cut costs by cutting staff. Coinbase, one of the most well-known exchanges, recently said it would cut 1,100 jobs due to expectations of a recession. Vauld, BlockFi, Crypto.com, Gemini, BitMEX, Buenbit and Bitso have all recently announced layoffs during one of the most difficult times for the industry.

Record inflation and raw material shortages due to Russia's war in Ukraine have posed challenges to production worldwide. World Bank chief David Malpass said on Sunday some countries would find it particularly special difficult to avoid a recession.

Economists at Goldman Sachs see an increased risk of a US recession. In a June 22 research note, the bank said it now estimates a 30% chance that the U.S. economy will enter a recession next year, up from 15% previously. Additionally, it sees a 25% conditional chance of a recession in the second year if one is avoided in the first year.

Bitpanda last raised $263 million in a Series C round in August 2021 at a valuation of $4.1 billion. The company said it was the first Austria-based company to cross the $1 billion valuation mark.

. .

The post Bitpanda to Slash Almost 30% of Workforce, Citing Recession Threat is not financial advice.