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