Crypto Platform Luno Sheds 35% of Workforce

Thursday, 26/01/2023 | 09:06 GMT by Damian Chmiel
  • Luno is a part of DCG, which is also reducing its current employment.
  • The company misjudged the level of industry slowdown during the crypto winter.
Bear-market, crypto-winter, Bitcoin

Luno, the digital assets exchange based in London, announced a massive workforce reduction yesterday, feeling the harmful effects of the prolonged crypto winter and turbulence in the technology industries.

Luno Cuts Massive Part of Its Team

Luno cuts crypto platform

According to Wednesday's statement, Luno decided to lay off 35% of its current staff, translating to more than 300 professionals in all regions where the crypto exchange is currently operating. The London-based company runs other offices in Cape Town, Johannesburg, Lagos, Singapore and Sydney.

"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, the Co-Founder and CEO of Luno, wrote in a statement on the company's blog.

Luno says it anticipated the industry downturn and was adjusting its business model to make it resilient to unfavourable factors. However, the speed of negative changes has put considerable strain on the original plan and proved inadequate. Consequently, the company has been forced to reduce the cost base and focus on the core business. Luno reassures that there is no impact on the liquidity of the existing business and the exchange's customers.

"Thanks to those who have helped us get this far, and also to those who will continue to drive forward our critical mission of putting the power of crypto into everyone's hands," Swanepoel concluded.

Watch the recent FMLS22 panel on crypto market structure.

Digital Currency Group Says Goodbye to 500 People

Cryptocurrency exchange Luno is part of the Digital Currency Group (DCG) portfolio, which includes CoinDesk, a cryptocurrency website, HQ Digital, an asset management company and Genesis, a failed cryptocurrency lender.

DCG slashed its workforce by 13% at the beginning of the year, cutting 66 full-time positions. Another 115 jobs were slashed in two rounds of layoffs at Genesis Global Trading. Subsequently, the company filed for bankruptcy protection.

HQ Digital ceased operations in January 2023, which could affect the position of at least 26 people, according to LinkedIn data.

In the meantime, Coindesk is reportedly for sale, which would help DCG raise additional funds to survive the current cryptocurrency winter, which was reported by The Wall Street Journal on January 18. Interest in buying the portal was confirmed by its CEO, Kevin Worth.

Luno Joins the Crypto Layoff Wagon

The problems of Luno and DCG as a whole are not isolated. Finance Magnates has repeatedly reported about plans of a number of digital asset companies to downsize over the past few weeks.

Gemini exchange announced its third round of job cuts, in which it wants to reduce its workforce by 10%. Previously, the workforce was shed in June and July when Gemini laid off roughly 17% of its professionals.

Last week, a cryptocurrency software company ConsenSys announced a similar decision. It confirmed its intention to reduce its current workforce by 11%, which translates into 100 full-time positions. Earlier, Coinbase, one of the largest cryptocurrency exchanges by volume, shared plans to lay off 20%, or 950 people.

The reason for cost-reducing and job-cutting is usually the same: a prolonged cryptocurrency winter, falling prices of major assets, and declining confidence in the industry after the collapse of FTX in November and the failure of Terra in May.

Luno, the digital assets exchange based in London, announced a massive workforce reduction yesterday, feeling the harmful effects of the prolonged crypto winter and turbulence in the technology industries.

Luno Cuts Massive Part of Its Team

Luno cuts crypto platform

According to Wednesday's statement, Luno decided to lay off 35% of its current staff, translating to more than 300 professionals in all regions where the crypto exchange is currently operating. The London-based company runs other offices in Cape Town, Johannesburg, Lagos, Singapore and Sydney.

"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, the Co-Founder and CEO of Luno, wrote in a statement on the company's blog.

Luno says it anticipated the industry downturn and was adjusting its business model to make it resilient to unfavourable factors. However, the speed of negative changes has put considerable strain on the original plan and proved inadequate. Consequently, the company has been forced to reduce the cost base and focus on the core business. Luno reassures that there is no impact on the liquidity of the existing business and the exchange's customers.

"Thanks to those who have helped us get this far, and also to those who will continue to drive forward our critical mission of putting the power of crypto into everyone's hands," Swanepoel concluded.

Watch the recent FMLS22 panel on crypto market structure.

Digital Currency Group Says Goodbye to 500 People

Cryptocurrency exchange Luno is part of the Digital Currency Group (DCG) portfolio, which includes CoinDesk, a cryptocurrency website, HQ Digital, an asset management company and Genesis, a failed cryptocurrency lender.

DCG slashed its workforce by 13% at the beginning of the year, cutting 66 full-time positions. Another 115 jobs were slashed in two rounds of layoffs at Genesis Global Trading. Subsequently, the company filed for bankruptcy protection.

HQ Digital ceased operations in January 2023, which could affect the position of at least 26 people, according to LinkedIn data.

In the meantime, Coindesk is reportedly for sale, which would help DCG raise additional funds to survive the current cryptocurrency winter, which was reported by The Wall Street Journal on January 18. Interest in buying the portal was confirmed by its CEO, Kevin Worth.

Luno Joins the Crypto Layoff Wagon

The problems of Luno and DCG as a whole are not isolated. Finance Magnates has repeatedly reported about plans of a number of digital asset companies to downsize over the past few weeks.

Gemini exchange announced its third round of job cuts, in which it wants to reduce its workforce by 10%. Previously, the workforce was shed in June and July when Gemini laid off roughly 17% of its professionals.

Last week, a cryptocurrency software company ConsenSys announced a similar decision. It confirmed its intention to reduce its current workforce by 11%, which translates into 100 full-time positions. Earlier, Coinbase, one of the largest cryptocurrency exchanges by volume, shared plans to lay off 20%, or 950 people.

The reason for cost-reducing and job-cutting is usually the same: a prolonged cryptocurrency winter, falling prices of major assets, and declining confidence in the industry after the collapse of FTX in November and the failure of Terra in May.

About the Author: Damian Chmiel
Damian Chmiel
  • 1521 Articles
  • 33 Followers
About the Author: Damian Chmiel
Damian's adventure with financial markets began at the Cracow University of Economics, where he obtained his MA in finance and accounting. Starting from the retail trader perspective, he collaborated with brokerage houses and financial portals in Poland as an independent editor and content manager. His adventure with Finance Magnates began in 2016, where he is working as a business intelligence analyst.
  • 1521 Articles
  • 33 Followers

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