If you try to keep up with the strange, occasionally confusing world of cryptocurrency, you’ve no doubt heard the term “crypto winter.” But what exactly is crypto winter, and why are tech firms like Coinbase, explicitly started to make crypto more accessible to the masses, rescinding job offers in response?
Not Unprecedented, But Certainly Unwelcome
The last crypto winter, a period where the values of cryptocurrency undergo a precipitous decrease, occurred in 2018 and lasted until 2020. During this time, the price of the MVIS CryptoCompare Digital Assets 10 Index lost nearly 80% of its value, marking a more significant drop than the dot-com crash in the early 2000s.
Although the crypto bubble isn’t the same as the dot-com bubble, it is a highly speculative market with considerable volatility, as we’re seeing firsthand. As currency like Bitcoin, Ethereum, and others become increasingly accepted as both an investment and a currency, many experts had thought the times of volatility might be behind. However, with the American economy facing a recession and general uncertainty, investors have started liquidating their riskier holdings. First on the list: crypto. Now we’re seeing the effects, and there are deeply personal ramifications.
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An Industry-Wide Impact
Getting caught up in the fear and uncertainty surrounding steeply falling crypto values is easy. Still, we should remember that real people are affected by these developments. Coinbase, which went public in late 2021, had been in a period of rapid growth through this year. As recently as May, the company had been hiring new employees from countries around the world.
These employees are now in a very precarious situation as Coinbase rescinds a “number of accepted offers” made in May and freezes all new hiring for an indefinite time. As a result, prospective employees, now facing very tight deadlines to get a new job or have their visas revoked, have taken to social media to share their frustrations and try to land new jobs.
Coinbase isn’t the only company putting the pause button on new hires. Gemini, another popular crypto platform, recently announced it’s cutting 10% of its labor force, citing “turbulent market conditions that are likely to persist for some time.” Likewise, Robinhood, which started dealing in crypto after the last crypto winter, is letting about 9% of its workforce go. In addition, Twitter and other tech firms have been putting the brakes on hiring actions, indicating a potential impact beyond just crypto and into the broader tech industry.
Remember the People
As the tech industry and crypto investors try to deal with the fear and uncertainty surrounding another crypto winter, it’s important to remember that crypto winters have come and gone before, often in just as unstable periods. We shouldn’t lose sight of the impact this will likely have on the job applicants and employees affected by these rounds of cuts.
Luckily, people have been using networks like LinkedIn to great effect to try and expand their network and find potential jobs. This is especially crucial in cases where international applicants were preparing to move to the U.S. and are in danger of losing what was likely months of hard work to acquire a visa.
It’s tough to tell where this uncertainty might lead. We’re not nearing the end of the crypto winter any time soon, and, likely, this might only be the first round in an ongoing series of cost-cutting measures in the tech and crypto industries. Time will tell whether this is a momentary panic or an indication of deeper problems in the cryptocurrency market.
