BlockFi cuts 20% of workforce citing market downturn

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Digital currency lending firm BlockFi is the latest company in the digital assets space to announce cuts to its workforce. The company has revealed that it will reduce its headcount by “roughly 20%.” 

BlockFi founders Zac Prince and Flori Marquez said in a blog post that “market conditions that have had a negative impact on our growth rate,” driving their decision to make the job cuts.

“We are reducing our headcount by roughly 20% and the reduction impacts every team at the company. This decision was driven by market conditions that have had a negative impact on our growth rate and a rigorous review of our strategic priorities,” according to the blog post.

The BlockFi executives explain that the digital assets market has been affected by a dramatic shift in the macroeconomic environment since Q1 of 2022. This has affected a lot of sectors, including tech and digital assets companies. To deal with the shift, BlockFi has been implementing policy changes to remain profitable, including reducing marketing spending, eliminating non-critical vendors, and reducing executive compensation. 

The founders also assure that customers will not experience any disruption to the company’s products or services. 

“We know this is a hard day, but BlockFi will persevere. Our ambition and commitment remain the same: to provide crypto-powered financial services that accelerate prosperity worldwide,” they surmised. 

BlockFi offers high-yield digital currency lending products, which has gotten the firm into some regulatory troubles. In February, it agreed to a $100 million settlement with the U.S. Securities and Exchange Commission (SEC) and 32 state regulators over its failure to register as security. 

The digital currency market nosedive has thrown a lot of digital assets firms into financial troubles. Like BlockFi, Crypto.com, Robinhood, and Coinbase, as recently reported by Bloomberg, have also announced headcount reductions. Celcius Network had to suspend withdrawals on its platform as the price drop of assets has strained its debt position. 

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