Leading blockchain analytics provider Chainalysis has executed a 15% reduction in staff, cutting around 135 jobs, due to prolonged downturn in cryptocurrency markets.
In an announcement this week, Chainalysis stated the layoffs constitute a “difficult but necessary decision” to reduce costs in the face of bearish crypto industry conditions.
Prior to the cuts, Chainalysis had approximately 900 total employees according to a company spokesperson.
Second Wave of Layoffs Amid Crypto Winter
The latest job cuts follow previous headcount reductions by Chainalysis in February 2022, when the firm shed around 40-50 workers citing restructuring needs driven by worsening market environments.
Overall, digital asset market capitalization has plunged 64% from its peak nearly two years ago. Disappointing price action, decreased trading volumes, and dampened investor appetite have persisted throughout 2022.
Per an internal email from CEO Michael Gronager, this second wave of layoffs primarily affected Chainalysis teams focused on marketing and private sector sales in order to right-size the business.
Crypto Contagion Impacting Firms
Chainalysis becomes the latest crypto-centric firm forced to pare back staff numbers amid the ongoing ‘crypto winter.’
Previous industry layoffs have stemmed from crises at companies like Celsius, Three Arrows Capital, and FTX causing sector-wide ripple effects.
While some view the cuts as a warning sign, Chainalysis stated its core business remains strong despite precautions taken to insulate the firm from bear market headwinds.
The company’s analytics tools continue seeing broad demand from government agencies and private institutions to monitor illicit crypto flows and ensure regulatory compliance.
By proactively streamlining operations, Chainalysis hopes to emerge leaner on the other side of crypto’s downturn. Their success is critical for fostering blockchain transparency.