Cryptocurrency exchange platform Luno announced on Wednesday it will slash workforce by 35% due to market turbulence.
The year “2022 has been an incredibly tough year for the broader tech industry and in particular the crypto market. Luno unfortunately hasn’t been immune to this turbulence, which has affected our overall growth and revenue numbers,” Marcus Swanepoel, founder, and CEO, said in a statement.
He said the decision is a result of the global economic downturn and a larger slump in the technology industry overall during the past few months.
A “crypto winter” and series of shocks involving other crypto firms such as FTX and Three Arrows Capital have also had an overall effect on the crypto industry, he added.
Swanepoel said those developments impacted Luno on the capital side, causing a more constrained funding environment, while the crypto market’s focus shifted from long-term investment to shorter-term profitability.
“While we anticipated a downturn and proactively planned ahead with a business and funding model that can be resilient to some of these factors, the sheer scale and speed of all of this happening, and all at the same time, has put significant strain on our original plan,” he added.
Luno’s announcement comes as tech giants including Amazon, Microsoft, and Google’s parent firm Alphabet lay off employees due to recession fears, economic downturn, and decline in advertisement revenues.
Many crypto firms faced financial hurdles last year, which was dubbed as “crypto winter” that included FTX, Three Arrows Capital, Voyager, Celsius, Genesis, and BlockFi.
Luno has more than 960 employees with over 9 million customers in 43 countries, according to its LinkedIn profile.
It is owned by Digital Currency Group (DCG) — the owner of digital currency asset management firm Grayscale Investments that had around $50 billion funds under management in 2021.
The DCG-owned cryptocurrency platform Genesis’ lending units filed for bankruptcy last week.