OpenSea has announced mass layoffs amidst a crypto crash and the lowest trading volume of NFTs since July of the previous year.
CEO Devin Finzer posted a Slack message to Twitter announcing the mass layoffs, which amount to around 20 percent of OpenSea’s total staff. According to the company’s LinkedIn profile (via Engadget), that’s roughly 150 people from a former team of 769 staff. Finzer wrote that laid off workers would receive "generous severance," healthcare coverage until 2023, and accelerated equity investment. OpenSea will also help with job placement through personal networks where possible.
The layoffs were necessary as OpenSea faces a "crypto winter" of crashing cryptocurrency prices and falling sales volume.
"We've been through winter before, and we built this company with the cyclicality of crypto in mind," wrote Finzer in his Slack message. "Nevertheless, the reality is that we have entered an unprecedented combination of crypto winter and broad macroeconomic instability, and 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 the multiple years of runway under various crypto winter scenarios (five years at the current volume), and give us high confidence that we will only have to go through this process once."
Finzer said he expects "an explosion of innovation and utility across NFTs" after the current crypto slump. However, OpenSea is facing more challenges than just falling crypto prices.
Earlier this year, thieves ran off with $1.7 million of NFTs stolen from OpenSea. The company never said how the thieves manages to make off with so many NFTs, but OpenSea users accused the platform of having security vulnerabilities that made it liable to be hacked. A class-action lawsuit seeks to prove those allegations in court. In addition, OpenSea recently suffered a data breach that released user data to an unspecified third party. That's unlikely to appease OpenSea users already jittery from crashing prices and alleged security vulnerabilities.
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