(Reuters) – Digital Currency Group-owned Luno said on Wednesday it would cut 35% of its total workforce, the latest in a slew of companies in the digital assets sector to reduce headcount to weather a slump in the cryptocurrency market.
“2022 has been an incredibly tough year for the broader tech industry and in particular the crypto market,” Luno said in a statement, adding that its growth and revenue has been affected by the downturn.
More than a trillion dollars in value was wiped out from the crypto sector last year, with rising interest rates exacerbating worries of an economic downturn. The crash led to high-profile bankruptcies of key industry players such as crypto hedge fund Three Arrows Capital and Celsius Network.
Still, the biggest blow came after major exchange FTX filed for bankruptcy protection in November. Its swift fall has sparked tough global regulatory scrutiny of how crypto firms hold funds and conduct business operations.
CNBC, which first reported the job cuts at Luno, said the reduction would impact more than 330 employees out of about 960.
Last week, the lending unit of crypto firm Genesis filed for U.S. bankruptcy protection, owing creditors at least $3.4 billion after being toppled by the crypto market rout.
(Reporting by Manya Saini in Bengaluru; Editing by Shinjini Ganguli and Anil D’Silva)
Copyright 2023 Thomson Reuters.