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Cryptocurrency exchange Gemini is laying off more employees, citing ‘bad actors’ in the crypto industry.
Gemini’s Third Round Of Layoffs
The Winklevoss twins’ brainchild, Gemini, is bleeding employees left and right due to its exposure to the now-bankrupt crypto lending platform Genesis. The exchange is laying off 10% of its workforce, citing reasons of ‘bad actors’ in the crypto industry. On top of that, this will be the third round of layoffs at Gemini within the last eight months. According to data accumulated by PitchBook and TechCrunch, the company had trimmed 10% of its staff in June, followed by another 7% being laid off a month later.
On Monday, employees were briefed about the layoffs on a Slack channel by the company’s president Cameron Winklevoss.
“It was our hope to avoid further reductions after this summer, however, persistent negative macroeconomic conditions and unprecedented fraud perpetuated by bad actors in our industry have left us with no other choice but to revise our outlook and further reduce headcount.”
FTX Aftermath Spells Industry-Wide Layoffs
Layoffs have been a part of the process for many crypto firms that were deeply affected by the FTX and Celsius catastrophes that wrecked 2022. Companies like Genesis, Crypto.com, Coinbase, Huobi, and Kraken have all had to eliminate positions to survive the severe nuclear winter in the industry that followed FTX’s bankruptcy announcement in November of last year. Crypto.com had to lay off 264 employees, and Coinbase had to slash 20% of its workforce in January 2023 to preserve cash flow in a second round of its layoffs. Genesis also had to terminate 30% of its workforce in the first week of the year while it was preparing for bankruptcy.
Gemini vs Genesis Saga
Gemini itself has been struggling over customer funds lately due to its long exposure to bankrupt crypto lender Genesis. The company has also been in trouble with the SEC due to its association with Genesis in connection with an alleged unregistered offering and sale of securities. The lending platform had previously generated high returns for Gemini clients through the high-yielding lending product Gemini Earn. however, once FTX filed for bankruptcy, Genesis abruptly froze lending. Customers were left with a shortfall of $900 million, forcing Gemini Earn to also freeze its accounts. The souring of relationships between the two crypto companies led to Cameron Winklevoss penning a harsh open letter addressing Genesis CEO Barry Silbert and accusing him of acting in bad faith.
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