The exterior of the Crypto.com Arena on January 26, 2022 in Los Angeles, California.
Rich Fury | Getty Images
Crypto.com announced on Friday that it is laying off 20% of its workforce. CEO Chris Marsalek said in a blog post that the cryptocurrency exchange had grown “ambitiously” but was unable to withstand the collapse of Sam Bankman-Fred’s crypto empire. FTX.
“All affected individuals have already been notified,” Marsalik said in a post.
The company has 2,450 employees, according to PitchBook data, which indicates about 490 layoffs. A Crypto.com representative was not immediately available for comment.
Cryptocurrency exchanges and lenders have been forced to aggressively reduce capital, a move accelerated by the FTX crash and the ensuing wave of crises.
Marsalek said the downgrade was part of Crypto.com’s continued focus on “prudent financial management.”
Like FTX, Crypto.com has entered into high-profile promotions and sponsorship deals, signing an eye-catching naming deal for the former Staples center in 2021 worth $700 million over 20 years. The arena is the home of the NBA’s Los Angeles Lakers.
“We have a big year ahead of us as we continue to help restore confidence in our industry,” Marsalek wrote. Marsalik founded Singapore-based Crypto.com in 2016, and has overseen a company that will have revenues of at least $1.2 billion by 2021.
Crypto.com has been bruised in 2022. Notable missteps have included several mistranslations, One which mistakenly transferred more than $400 million in assets to another exchange. The company has also laid off some employees in 2022.
In December, CNBC reported on some of Marsalek’s business successes and failures. At the time, Marsalek dismissed concerns about the stability of Crypto.com.
“Startingups are hard…but there is no better way to live,” he said books.