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While the cryptocurrency market might not be facing significant downturns after the initial crash, several platforms and exchanges are still struggling to keep up with the market. United States-based crypto exchange Robinhood has announced that 23% of its staff have been let go in order to cut costs to maintain stability in the current market.
According to Robinhood CEO Vlad Tenev, the decision comes as a result of the continued deterioration of the macro environment, with inflation continuing to rise. Further to this, the broader cryptocurrency market crash has led to a need to cut resources and focus on greater cost discipline. The CEO stated that the layoff would be impacting all systems in the firm, with particular weight on the operations, marketing, and program management departments. Tenev also noted that this is “unsettling”, with the staff at the exchange being one of the most important parts of the mission.
“I want to acknowledge how unsettling these types of changes are. We often talk about our mission to democratize finance for all, and one of the most cherished aspects of Robinhood is the teamwork and camaraderie involved in working towards our mission — together.”
The news came after the exchange had a mediocre second quarter of revenue. The company posted its quarterly financial results looking at a 44% year-on-year decline. While the results were up 6% from the year’s first quarter, the firm was still looking at a net loss of around $295 million USD in the quarter. In addition to the revenue results, the New York State Department of Financial Services also slapped a whopping $30 million USD fine for the firm’s cryptocurrency branch owing to reported anti-money laundering and consumer protection violations.
Should they wish, the estimated 780 employees will remain employed until the beginning of October with full pay and benefits, as well as job search assistance and the option to have their names added to the Robinhood Alumni Talent Directory.
“Departing Robinhoodies will be offered the opportunity to remain employed with Robinhood through October 1, 2022 and receive their regular pay and benefits. They will also be offered job search assistance (including an opt in Robinhood Alumni Talent Directory).”
— zerohedge (@zerohedge) August 2, 2022
Earlier this year, Robinhood had to let go of nearly 10% of its staff, but Tenev explained that the cuts had not gone far enough. He wrote:
“Earlier this year, I announced that we would be letting go of 9% of our workforce and focusing on greater cost discipline throughout the organization. This did not go far enough… [We] are operating with more staffing than appropriate. As CEO, I approved and took responsibility for our ambitious staffing trajectory – this is on me. “