The cryptocurrency bubble is bursting, the crypto winter is here, and the digital currency market is in decline. Whatever descriptor you want to use, these are dark times for cryptocurrencies. As the market tumbles, one of the biggest exchanges is detailing its plans for survival. Kraken says that it will slash its operating expenses and cut staff from its global workforce.
Earlier this year, we reported on the prediction that the crypto market will retract. Many smaller coins will simply disappear while large currencies like Bitcoin and Ethereum will survive. There are currently over 19,000 cryptocurrencies and the market cannot sustain them all.
That decline is underway and ongoing. However, for an exchange like Kraken there is another threat. Following the collapse of FTX last month, investors are putting less faith in exchanges and are instead turning to their own personal wallets.
FTX is a cryptocurrency trading platform based in the Bahamas. Since 11 November the company has been in bankruptcy. By using their own self-custody wallet, BTC holders receive a private key of seed phrase that provides access to the wallet. If this information is lost, the wallet becomes unrecoverable. Even so, this is a good holding method because no third party can spend or freeze your BTC.
Kraken is facing the crypto winter and uncertainty amongst investors. The company says it will cut its workforce or 1,100 by 30% to survive the storm.
“Today we're announcing one of the hardest decisions at Kraken to date. We're reducing our global workforce by approximately 1,100 people, or 30 percent, in order to adapt to current market conditions,” Jesse Powell, Co-Founder and CEO of Kraken, says.
“We are extremely grateful for the contributions of those impacted by today's announcement and we'll do our best to help them transition to their next opportunity. All impacted Krakenites have been notified as of this morning.”
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