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Speaker 1: I'm Stacy Marie Ishmel, Managing editor of Crypto for Bloomberg News. And this is Bloomberg Crypto, a daily Bloomberg IHOT podcast. It's Tuesday, March fourteenth. Here's a fact for you. We're barely three months into twenty twenty three, and already crypto companies have cut thousands of jobs this year. This is consistent with what's been happening in tech and finance across the board. There have been multiple rounds of layoffs at places like Twitter, job cuts at Meta and Google, and even at big investment banks like Goldman Sachs. In crypto, the cuts are across the board, including a big names like Galaxy, Digital, Genesis and Chainalysis. Some like the beleaguered crypto friendly bank Silvergate, Capitol and lender Amber Group, have cut as much as forty percent of their workforces. It's also true that some companies, even in this environment, are hiring. Among the crypto firms planning to add staff this year is Circle Internet Financial, the company behind one of the largest stable coins. When I spoke to their CEO, Jeremy Laire, he said, a big hiring focus this year. We'll be on software developers and on expanding globally. We are primarily hiring engineers and product leaders, and then we are continuing to expand around the world, and so we're opening up more outposts because we see there's a lot of global demand for what we do, and so we want to do that. And but principally, yeah, this is all about the incredible opportunity to develop intellectual property. So what does the state of hiring and firing and crypto suggest about the general health of the digital asset industry, Bloomberg reports to Hannah. Miller joins me now to discuss the latest Hannah, welcome back to the show. Thank you for having me. I'm always have two minds when you know, talking about things like layoffs and tech and finance and crypto, because the inasmuch as you could talk about the macroeconomic environments and interest rates, fundamentally, what we're talking about is people who had jobs no longer having jobs. But what we've certainly been seeing is in crypto, in tech, in finance, there have been what feels like so many waves of layoffs. You know, we're getting into the thousands, and in the case of the tech industry more broadly, tens of thousands. Of people. What are the prospects looking like in twenty twenty three. If you're a graduate coming out of Stanford or somewhere, are you still thinking I definitely want to work in the crypto industry. Yeah, I think for the crypto industry, it's a big wake up, Carl. I mean these layoffs have been happening for a long time now. I mean they started before we saw layoffs and you know, the mainstream tech industry as well as in finance. But it's been really interesting to see just company after company within the crypto space cut further and further, and there is this question of how much more can they cut? You know, like, how how are they our? Is there any more fat to trim? So it's it's pretty I think
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it's it's been a it's a very stark contrast when when you saw that crypto was a really hot sector for people to go into, you saw people leaving very cushy jobs at you know, Google Meta to jump over to a crypto company to get you know, a token bonus, a equity and a startup that they thought really had promise. It's definitely a different story, now's your point. It's not just a different story. It's kind of a mixed story, right, Like we heard from Jeremy Laircu of Circle saying that they're really excited about being able to hire more developers and they're looking at global expansion. Where are these pockets of optimism coming from despite the broader environments you've just described. Yeah, well, I think for some companies, you know, they were able to raise a lot of money during the crypto boom, they have a lot of runway that they can use to last through this crypto winter. So there are companies that still have cash to play with, and you know, they can draw in, you know, new hires. They can you know, snap up developers and maybe just got laid off of that Google job and are really looking for a new opportunity. So some companies are definitely still hiring. And yeah, hot hot areas are definitely developers people who specialize in security. That's always a concern in crypto. So you know, I think for some startups that are just starting out, like that's like having someone who who knows cybersecurity, who can help you know, FIFA protection on a platform. That's a good person to have. But yeah, there there still is a need for engineers among certain companies who definitely raised that big valuations and had big funding rounds during you know, twenty twenty one or twenty twenty two. So what I'm hearing is, if you're graduating or if you're one of those folks, it's like, I don't need to go to college because life works in your favor that way, and you have technical skills, then you as a person have a reason to be optimistic because that's the sort of the profile the skill sets that these companies are looking for. Yeah, I mean, you might not get the cushy benefits that you would have at at Google or Meta. I mean even those companies are sort of slashing you know, things like laundry at the office or you know what time, what time you have to stay at the you know, at the office to get a meal. You know, it's just things like that. You know, you might not you might have to set aside even if you are going for a mainstream tech job. But within crypto, yeah, there are still people who are very passionate about the space we're going in. You know, they're looking at programming languages that they would need to learn to work at a at a blockchain platform. So whether it's rest or solidity. You know, those are those those types of skills are in demand. So yeah, I mean, I think even though the broader picture is pretty bleak, like you said, there are these pockets of hope where you know, there are companies that are still hiring, still looking for people. Let's talk about some of the companies that have laid a lot of folks off. So you know, we've we have this running tally of job cuts, not just in crypto or colleagues in tech have one for you know, tech layoffs, our colleagues on on finance, like these are the biggest banks that have had layoffs. But the names for crypto, you know, it's like blockchain dot Com twenty percent at one point, coin Base twenty percent at one place, Crypto dot Com twenty percent, Silver Gates Crypto Friendly bank that's very much in the news at the moment, forty percent, Genesis thirty percent. One of my questions for you is, you know, we talked up several months ago at this point that these companies started with departures at the top. It was like the summer of executive departures at crypto CEOs. We're leaving CEOs, We're leaving managing directors, we're leaving or being asked to leave, or seizing the opportunity to spend time with their families. Have these layoffs filtered down into the ranks or are they still kind of concentrated in more senior people. From what you can tell, I think it's been a trickle down. You know that this this is affecting just your regular employee who is checking their email in the morning and might not know whether there's a letter there about them leaving. So it's it's something that's affecting all ranks within companies, and it's also affecting people with technical talent too. It's not just you know, your marketing folks or you know, the comms team or whatever. It's something that's that's hitting people at all levels, at all different types of backgrounds. So it's it's it'll be interesting to see going forward, you know, how crypto exacts are gonna handle this. You know, in some cases some of these companies have brand new leadership. Who are you know, figuring out the ropes, you know, trying to leave these companies forward. But yeah, it's definitely something that we're keeping a close eye on as we report on the industry. In addition to companies that have big operations in the United States, you've also been reporting on folks based in Asia, for example, one of them being Amber Group, who were in that category of having you know, laid off forty percent of its workforce, scrapped bonuses, had managers take salary cuts. I think they canceled a sponsorship deal they had with CHELSEAFC. Is it that this is a kind of a global problem. Are there any geographies that have been hit harder and others? Yeah, it's been interesting to see in Asia what's been happening there, because the crypto regulatory environment in some ways is advancing further there. You know, we've actually seen a reversal in Hong Kong, you know, in terms of their crypto policies, they're actually becoming a little bit more friendly digital assets. Um. You know, Singapore is still a hotbed for for crypto activity. But yeah, I mean geographies that have been hit hard. Um, you know, Asia has definitely seen some layoffs. I mean coin Base, for example, is winding down
operations in its Japan office. Europe has also been hit hard. I remember with Amber the layoffs that were happening there. They were hitting Europe first before going to you know, the their offices in Asia, and with Amber specifically, it's been very interesting. I mean, this is a company that's raised a lot of money over the years. For them, they grew very very quickly, and kind of where they're at now a sort of is reversal. They're back to their roots in a way because it's a much smaller workforce that they're dealing with. It's like two to three hundred people versus more than a thousand when they were at their height. So I think for some of these companies, they grew super quickly, built out their teams, you know, hired everyone when you know there was a bolt when there was a bowl market, and now they're sort of reconsidering things and saying, hey, maybe I did grow a little too fast and going back to basics. We'll be right back with more from Bloomberg report. To Hannah Miller, one of the Capital d discourse things that are happening right now, as it relates to layoffs at places like Meta and Twitter, is this idea of tech companies and so so it's an extent crypto company is trying to get rid of middle managers, right and there's this narrative about middle managers. They just like send emails all day. They're not really doing the real work of so calls like engineers. And they're also not the senior executives making the decisions about things. The folks who are say middle managers, will often point to the fact of like, Okay, well, we are the primary coordinators of the big ideas that are coming down from the C suite and the people who have to make them happen. Like we're helping people prioritize, we're helping people ship. Have you seen other cycles where layoffs look like they're being used to like flatten the hierarchy of companies And do these companies tend to reintroduce hierarchy in boom times or are we seeing something really different now? Yeah, I mean I think in the past there was you know, companies that gravitated towards flat structure. I remember there's some cryptoc companies say they didn't even have like formal titles. You know, they wanted to have this sense of camaraderie, you know that everybody's equal. It's just about building, it's not about where you rank. But I think the fact of the matter is that you know, companies like Twitter are now dealing with these changing structures that they want to just streamline everything and you know, cut out who they can and yeah, the middle manager is going to be a good target for that. So looking ahead, it'll be interesting to see whether in the crypto space that they kind of go back to tradition and having a more structured environment just to to maybe put things in perspective as they sort of write a ship here. But I think corporate structure is very interesting and right now in tech and crypto, there are a lot of models for it, so it'll be interesting to see which ones survive
and thrive. And to that point about there being a lot of models, you know, it seems like the most consistent narrative we're hearing from a lot of crypto companies is one we're excited about hiring is eineers. Two, we're looking for growth opportunities outside of the United States, And in those conversations various folks have mentioned opportunities in the UE and buy for example. And three this idea to your point of like focus right like really picking an area of expertise, perhaps not launching an NFT marketplace that no one is asking for and really trying to identify what those core strengths are. You also report a lot on the VC side of this question. Are you seeing kind of a similar narrowing of focus on the VC side? You know, you mentioned security earlier in terms of themes that they might be excited about. Is anything changing about their approach? Yeah, well, the pace of deals is just slowed in general. You know, vcs are taking their time more when they're looking at companies, you know, whether they want to invest in them. And the other thing too, is that they're looking for more traditional things on a board seat, you know, they they want their you know, they want some sort of oversight to be in place, you know. So so those things you're seeing a return to traditional values um in in venture capital when it comes to investing in crypto And yes, I would say there's you know, some increased specialization. You know that they're looking for companies that maybe just want to narrow the focus to in you know, infrastructure or you know, security, or maybe they're you know, specifically into gaming, NFTSUM. But at the same time, I have seen some vcs gravitate towards other industries, including artificial intelligence, because that's obviously really hot right now. So, like I remember, I was talking to a VCS like, yeah, like we want to hire someone who can do AI, you know, and just the whole planning by themselves, yes, you know. So it's I think they're also sort of spreading their bets as as well, even though they want the companies they invest in to be more specialized. Yeah, what was the thing that folks at Andrews and Harrowitz used to say before they blocked all the journalists on Twitter? Software will eat the world. Maybe it'll be AI will eat the world, and we'll see how well that turns out. So more to come on that topic, I'm sure. Thank you so much, Hanna, Thank you. That was Bloomberg Report Hannah Miller. You can find more of her reporting on the Bloomberg Terminal and on Bloomberg dot com, and be sure to check out our twice weekly crypto news leto Bloomberg Crypto. This is Bloomberg Crypto, a daily podcast from Bloomberg and iHeartRadio. For more shows from iHeartRadio, visit the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts. Send us your comments, questions, or suggestions. For the show to Crypto at Bloomberg dot Net. The supervising producer of Bloomberg Crypto is Vicky Vergalina. Our senior producer is Janet Babin. Our producers are Mohammed Farouk and Sharon Barrero. Our associate producers are Ty Butler and Moses on um Desta wonder At is our engineer. Original music by Leo Sidron. I'm Stacy Mariaschmael. We'll be back tomorrow.