In a stark reflection of the current state of the cryptocurrency market, Ledger, a prominent player in the cryptographic hardware wallet industry, has been forced to make a tough decision. The company, boasting a workforce of 734 employees, is laying off approximately 90 staff members, accounting for 12% of its workforce. This move is a response to the relentless pressures of the crypto winter, a period characterized by market downturns and economic challenges.
The cryptocurrency landscape, which once experienced a dazzling surge in 2020 and 2021, has taken a harsh turn in recent times. During these years, cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) reached unprecedented highs, captivating investors globally. Even alternative coins and non-fungible tokens (NFTs) basked in the glory of soaring market capitalizations.
However, the narrative drastically changed in 2022. Central banks worldwide applied the brakes, responding to economic challenges with inflation control and liquidity tightening. This economic phenomenon persisted throughout 2023, continuing to exert significant pressure on the crypto industry.
Several disasters, including the collapse of the Terra ecosystem and the bankruptcy of FTX, dealt crippling blows to the once-bullish market. As a result, Bitcoin’s value plummeted by 60% from its 2021 peak, and numerous major altcoins faced staggering declines, some dropping by more than 90%.
The decentralized finance (DeFi) sector, once vibrant and bustling, now wears a somber look. Trade value locked (TVL) across all chains dwindled to $78 billion, a mere fraction of its over $300 billion glory in late 2021. Simultaneously, global exchanges witnessed an alarming drop in spot transaction volumes, reaching a historical low since late 2020, standing at just over $300 billion in September. This was a far cry from the staggering $4 trillion high recorded in May of the same year.
The dire state of the market has led to significant financial setbacks for various crypto companies. Between April 2022 and March 2023 alone, approximately 30,000 personnel in the crypto industry were laid off. Considering the market’s ongoing challenges, this number has undoubtedly risen considerably in the subsequent months.
In this tumultuous period, Ledger’s decision to downsize is a poignant reminder of the crypto industry’s vulnerability to market fluctuations. As the crypto winter persists, industry leaders like Ledger must navigate these stormy waters, making tough decisions to weather the financial turbulence and emerge stronger on the other side.