As crypto winter sets in, Web3 companies are finding themselves in the difficult position of cutting staff. During a company call earlier today, Vienna, Austria-based Bitpanda announced that it would be reducing its headcount from 1,000 employees to 730.
“We are committed to Bitpanda’s mission, therefore we need to take decisive actions now,” the company said in a blog post. “The implications hurt: we need to let part of our team go and scale down to a target organizational size of about 730 people.”
Bitpanda joins a growing list of crypto companies that have announced layoffs in the wake of the recent downturn. Other companies slashing employees include Crypto.com, Bitso, Buenbit, BlockFi, and Coinbase, which cut 18% of its workforce and even rescinded employment offers to new hires.
In a Slack thread included in the post, BitPanda cites changing market sentiment, geopolitical tensions, rising inflation, and concerns of a looming recession as some of the reasons for the layoffs.
“There’s lots of uncertainty in the financial markets right now and, while we do know that the industry is cyclical, nobody knows when the market sentiment will change,” Bitpanda said.
The company is backed by tech billionaire Peter Thiel, who led a series of fundraises totaling over $500 million for the European exchange between September 2020 and August 2021. By August 2021, Bitpanda had a valuation of $4.1 billion.
The road has been bumpy so far, and the company acknowledged that it was struggling with growing pains. The blog post, titled "The Way Forward" and signed by the founders, explained that the speed at which they were hiring was a mistake and unsustainable.
“In keeping up with the industry, our team’s growth rate has been too high,” the company says. “We reached a point where more people joining didn’t make us more effective, but created coordination overheads instead, particularly in this new market reality.”
Cost management is essential, the founders continued, and fundamental operational changes are necessary. They added: "These changes include prioritizing safety and compliance, user experience, education, and community, and deprioritizing everything else."
The company listed several support options for employees affected by the downsizing, including help finding new employment, references, and mental health support.
The post noted: “While this is a tough decision to make, it was nonetheless necessary to make sure we’re robustly well-capitalized to navigate the storm and get out of it financially healthy—no matter how long it takes for markets to recover—without compromising on product quality and customer experience.”