Tech Market Turbulence Hits Fireblocks as Crypto Startup Slashes Jobs

Crypto startup Fireblocks has decided to slash jobs as the firm undergoes restructuring. According to a Bloomberg report, Fireblocks is planning to lay off nearly 3% of its workforce. The move echoes in tandem with other market players with Polygon Labs and SNAP token creator also announcing job cuts previously.

Fireblocks to slack 3% of its workforce

According to Bloomberg, Fireblocks Inc. lowered its workforce on Tuesday after a planned restructuring. The move comes as other tech and financial markets are also grappling with job cuts. The move also adds to the 32,000 jobs that have been lost in the digital sector this year alone.

“To give our customers a more streamlined and efficient service and to position the company for expansion into new geographies, Fireblocks has been working to restructure our go-to-market and customer support operations over the last six months,” the company said in a statement to Bloomberg. “The reorganization has affected less than 3% of our teams”, it added.

Fireblocks’ layoff comes as other crypto companies also slash jobs

Previously, Snap Inc., which created the SNAP coin, announced that it would be letting go of about 10% of its workforce. As per reports Snap is presently engaged in the process of terminating approximately 528 employees. Even other crypto and Web3 firms have braced for the impact of the same uncertainty. An example of this is Polygon Labs’ decision to cut roughly 19% of jobs.

The ripple effect of large layoffs by technology and financial giants globally has had its ripple effect on the crypto markets as well. Large tech companies, such as Amazon and Alphabet, announced layoffs back in January.

Additionally, with Deutsche Bank’s announcement of job losses, the banking industry has also been dealing with comparable problems. The financial behemoth Citi had also declared that they will be laying off about 20,000 employees in a similar vein. Both banks announced layoffs after their underwhelming quarterly profit reports. The massive investment banking firm BlackRock Inc. had already declared that it would fire 3% of its staff.

Why are huge layoffs taking place?

According to research by Stanford, the layoffs in the tech sector are an example of social contagion—a phenomenon in which businesses mimic the actions of their peers. Though reasons to let an employee go are different for different firms, the striking similarity is in the effect of it. In the past year, almost all big firms have announced job cuts. In such a race even shareholders look for cost-cutting which might sometimes force a company to stick to the layoff bandwagon.

The research also answers one of the most sought-after questions these days, i.e. is a tech recession possible? The answer to this difficult question is “Sure”. The present layoffs also indicate that in the past decade, tech and financial firms might have over-hired people and are now just reducing staff to make sure that operations run smoothly.