OpenSea has announced laying off about 20% of its team owing to the continuous downturn of the cryptocurrency market.
The dreaded “crypto winter” has finally caught up with OpenSea, one of the world’s largest NFT marketplaces. The NFT marketplace has officially joined a list of companies feeling the agonizing sting of the crypto market’s downward spiral.
On Thursday, the company’s CEO, Devin Finzer, took to Twitter to announce that OpenSea is laying off roughly 20% of its team. He even shared a screenshot of the note he shared with employees.
OpenSea Is Coming Clean
Despite the significant decline in crypto markets, many of the top players in the industry are still in denial regarding the actual state of the industry. Some are holding back from vocalizing the harsh truth that the good times are over, at least for the time being. In the case of OpenSea, its CEO didn’t mince words when announcing the layoff.
“… [T]he reality is that we have entered an unprecedented combination of crypto winter and broad macroeconomic instability …,” Finzer said in his announcement.
According to Finzer, they will be letting go of “smart, hardworking, mission-driven individuals who’ve played an immeasurable role in growing OpenSea and the NFT space” to where the company is. He added that the laid-off staff will be sorely missed and that these people will forever be part of OpenSea’s story and community.
“For those leaving us, we’ll be providing generous severance [12 weeks’ worth], healthcare coverage into 2023, and accelerated equity vesting for those who haven’t hit their cliff,” Finzer wrote. “We’ll also be helping with job placement and opening our personal networks to support them however we can.”
Reason for the OpenSea Lay Off
Finzer cites the so-called crypto winter as to why OpenSea decided to lay some personnel off. On a sidenote, although crypto winter generally describes a poorly performing crypto market, it can also be applied to the NFT market since NFTs and cryptocurrencies rely on blockchain technology. Moreover, people need crypto to purchase NFTs.
“We need to prepare the company for the possibility of a prolonged downturn. The changes we’re making today put us in a position to maintain multiple years of runway under various crypto winter scenarios (five years at current volume) and give us confidence that we will only have to go through this once,” he wrote, claiming that the layoffs are in preparation for a probably prolonged crypto winter.
Initially, OpenSea did not specify how many employees the layoff would affect. Eventually, the company shared that they would be left with 230 employees following the layoffs.
A spokesperson for OpenSea was asked to comment on the company’s decision. However, in response to the request for comment, the insider said, “It is clear that the current macroeconomic factors and global unrest will continue to have broad-reaching implications across Web3.” The insider then reiterated what Finzer said regarding the laid-off employees’ benefits.
OpenSea CEO Remains Positive
The decision to lay off ~20% of OpenSea’s employees made the company’s aggressive growth tactics questionable. It also raises doubts about how the company handled the sustainability of the NFT industry’s rapid growth. However, Finzer is holding on to the last shred of positivity amidst the situation.
On Twitter, Finzer wrote that he has “immense conviction in the NFT space and in OpenSea’s role in it,” adding that he is optimistic there will be “an explosion in innovation across the ecosystem” during the crypto winter.
Finzer also said that based on the changes OpenSea has made, they are “in a strong position to continue driving the space forward.” He also implied that with the uncertainty of the global economy, the company’s mission “to build a foundational layer for new, peer-to-peer economies feels more urgent and important than ever.”
OpenSea benefited much from crypto’s bull run in 2021-2022. The company raised hundreds of millions in investor dollars, the most recent at a $13.3 billion valuation.
However, OpenSea’s growth has not been without perceived drama. In June, one of the company’s executives, Nathaniel Chastain, was arrested on charges of insider trading following an NFT trading scandal.
Aside from OpenSea, other companies that have laid off employees recently include Gemini, Crypto.com, and BlockFi.
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