Billionaire bitcoiners Cameron and Tyler Winklevoss are laying off 10% of the workforce at Gemini, a first for the U.S.-based cryptocurrency exchange and custodian.
The twins announced in a blog post on Thursday morning that the industry is in a “contraction phase” known as “crypto winter” which has been “further compounded by the current macroeconomic and geopolitical turmoil.”
“We are not alone,” the memo continued. Fellow crypto exchange Coinbase recently reported that revenue had fallen 27% from a year ago, as had overall usage.
It’s been a brutal few weeks for the crypto market. Half a trillion dollars was wiped off the sector’s market cap as terraUSD, one of the most popular U.S. dollar-pegged stablecoins, imploded virtually overnight. It is unclear whether this recent rout marks the next crypto winter (a multi-year bear market that occurs on a cyclical basis for the crypto asset class), though dropping trading volumes on crypto exchanges is one sign that we may be headed in that direction.
The last so-called crypto winter ran from 2018 into the fall of 2020 as the value of cryptocurrencies plunged, and layoffs were rife.
Gemini — which has been around since 2014 and is valued at $7.1 billion as of its last funding round — has 1,033 people on its payroll, according to Pitchbook, which translates to about 100 employees affected by today’s layoffs. CNBC reached out to Gemini to ask for the exact figure, but the press team declined to comment beyond the blog post.
As for next steps, Gemini has closed its physical offices today in order to protect employee privacy. Impacted team members will receive a calendar invite for individual conversations about separation packages and healthcare benefits. On Friday, remaining employees will take part in a “company-wide standup” to talk about its future.
The memo says that Gemini wants to focus only on products that are critical to its mission — and team leaders will assess whether their teams are “right-sized” for the “current, turbulent market conditions that are likely to persist for some time.”
“Today is a tough day, but one that will make Gemini better over the long run,” the brothers wrote in the staff-wide memo.
Other fintech start-ups like Robinhood and BitMEX have recently cut staff.
But even as crypto companies pare back their rosters, venture capitalists continue to pour money into the crypto ecosystem. Andreessen Horowitz recently announced a new $4.5 billion fund dedicated to backing crypto and blockchain companies, and Binance Labs (the company’s venture arm) has raised $500 million for a fund dedicated to investing in Web3 start-ups.