Crypto exchange KuCoin has been forced to clarify reports that it plans to lay off more than 300 staff, claiming they are “routine performance appraisals”
Crypto firms, particularly exchanges, have been conducting massive layoffs since 2022, with the bear market pushing companies to cut costs in order to maintain a lean team.
Layoffs Due to New KYC Rules?
Chinese reporter Colin Wu tweeted that KuCoin will let go of 30% of its team members. The exchange currently has a headcount of approximately 1,000 employees. Wu claims they got confirmation from more than three KuCoin employees about the upcoming layoff.
Initially, the reporter cited that the main reason for the layoff was a recent decline in profits due to stricter know your customer (KYC) rules. From July 15, the exchange enhanced its KYC policies after being sued by US authorities, alleging securities law violations.
Learn more about the 13 best no-KYC crypto exchanges here.
However, KuCoin responded to the reporter and explained that the development was a “normal performance appraisal.”
Star Atlas Undergoes Restructuring, Staff Down 80% From Peak
On Monday, Web3 gaming company Star Atlas’s parent, ATMTA, announced a significant reduction in its headcount. The CEO, Michael Wagner, explained that Star Atlas’s treasury suffered a dent of over $15 million due to the FTX collapse, significantly impacting its runaway.
After the layoff, the core team would consist of 45 employees, around 80% down from the peak of 235 employees in 2022. Wagner wrote:
“To demonstrate our commitment to the team and to being in this together, each of the founders will be reducing their fixed compensation by a material amount.
I personally will be taking the minimum salary necessary to maintain exemption (no hourly tracking) compliance under existing labor laws.”
According to media reports, the world’s largest exchange Binance also laid off more than 1,000 employees recently. But Changpeng Zhao, the exchange’s CEO, claimed that the media’s numbers were FUD (a term to represent the spread of fear, uncertainty, and doubt).
According to Bloomberg data from March 2023, the crypto layoffs have rapidly increased since 2022 due to the bear market. The screenshot below shows that major layoffs come from crypto exchanges.
Crypto layoffs since 2022. Source: Bloomberg
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