Staff at Kraken have become the latest victims of the crypto winter after the US-based exchange announced 1,100 job cuts.
One staffer said: “I went to get a coffee, came back and was locked out [of my laptop] and checked the news and saw it announced on CNBC.”
Only several hours later did they hear from the company, via a message sent to their personal email address.
Another former Kraken worker in the US said the process had left members of their team “clueless and upset”.
A Kraken spokesperson said supporting laid off staff was the firm’s “top priority,” and said the shutdowns were done for security reasons. Here’s the announcement from 30 November in full.
Somewhat worryingly for workers, Kraken’s method of laying people off via sudden IT shutdowns is growing increasingly common at US tech firms.
Twitter staff recently suffered a similar experience when the firm axed an estimated half of its 7,500 employees, according to The Wall Street Journal.
But crypto companies in particular have faced repeated criticism when it comes to corporate processes, including audit and HR, all of which fall under corporate governance rules that tradfi firms routinely comply with.
Coinbase came under fire from its employees for doing similar to what Kraken’s staff reported in a round of job cuts in June, while two directors at the bankrupt crypto lender Celsius recently hammered the firm’s corporate governance in an interview with FN.
Meanwhile, FTX’s administrator, John J Ray III, said the firm’s corporate controls and accounts were worse than those of Enron, whose liquidation he also oversaw.
And then they came for the hedgies…
As if things couldn’t get any worse for crypto, now investors are shying away from the industry’s hedge funds too, after BlockFi became the latest firm to file for bankruptcy amid significant exposure to FTX.
“At this stage, nobody really knows how far the effects of [FTX] will go,” Marc P Bernegger, co-founder of crypto hedge fund AltAlpha Digital, told Financial News.
“Most investors are very reluctant to invest in crypto hedge funds in these turbulent times and are waiting on the sideline.”
And according to CK Zheng, chief investment officer at ZX Squared Capital, crypto hedge fund investors are still uncertain about how many more forced liquidations will be triggered after the collapse of FTX and BlockFi.
What’s SBF saying today?
Sam Bankman-Fried’s lawyers could have been forgiven for thinking he had calmed down on speaking publicly after everything that’s happened.
But the former FTX chief executive – who many have argued should face jail time for the way he ran the now-bankrupt firm – has continued speaking publicly with aplomb.
So far, he has given interviews to more than half-a-dozen US-based media outlets and even let one reporter into his house in the Bahamas.
He has said he is “sorry” in pretty much every interview, and, according to US attorney Jeremy Hogan, said things which are “incriminating”.
Hogan, founder of the law firm Hogan & Hogan, tweeted: “Why are his lawyers (or parents) letting him do this?”
On tech layoffs, at least a16z approves
The recent round of tech layoffs, including those at Kraken, have left thousands of people out of a job, sometimes under abrupt circumstances.
But two partners at Andreessen Horowitz, one of the best-known VC names and the world’s biggest crypto investor, were full of praise for Twitter boss Elon Musk’s decision to axe thousands of people — and the fact that others are likely to copy it.
Andrew Chen, a partner at the firm also known as a16z, tweeted that Musk’s moves were “inspiring founders who are making tough decisions in the recent economic downturn”.
“I’ve heard from many founders who are cutting fat, making big product moves, and getting hardcore — and not afraid,” he said. “A new playbook is being written in real time.”
Sriram Krishnan, a partner at the firm also known as a16z, added, also via a tweet: “I’m hearing from multiple CEOs how Elon Musk has shifted the toolset/culture they thought available to them.”
That shift includes “demanding more of their teams” and “cutting non-essential functions”.
Whether laid off workers at Kraken, Twitter, and others would lavish Musk with the same praise is another matter entirely.
To contact the author of this story with feedback or news, email Alex Daniel