Opensea Lays Off 20% of Staff, Fearing Crypto Winter

The Worlds top NFT marketplace Opensea lays off 20 percent of its workforce as a combination of a crypto winter and broad macroeconomic instability brings about a decline for crypto companies.

We are all well aware of the crypto winter engulfing anything blockchain, including the related NFT industry. Furthermore, we have witnessed most digital assets drop in valuation, NFT transactions plummet, and crypto companies forced to declare bankruptcy.

However, we sometimes lose sight of the fact that behind all the avatars, groundbreaking innovations, and technology are workers., people similar to you and me who have to pay bills.

Crypto Winter

The continuing bear market downtrend is the main cause of OpenSea’s layoffs, followed by new competitors. They are not alone in such layoffs. Two recent entrants into the NFT market also announced reductions in their workforce.

Take GameStop. It opened its NFT platform after laying off employees days before its launch. While, Coinbase who recently opened its own marketplace, announced the departure of 1100 employees last month.

Additionally, a catastrophic drop in daily NFT sales on the OpenSea NFT marketplace has seen daily volume drop by over 75% since the beginning of May. According to data from Dune, dollar sales on 1 May, totalled over $476 million, whereas 15 July, by comparison, saw a total sales volume of $14.61 million.

Moreover, this year has seen some serious competition enter the sphere, including LooksRare. The new competition, coupled with the prospect of a prolonged downturn, has necessitated a reduction in staff levels.

sales on OpenSea
Courtesy of rchen8 Dune Opensea. https://dune.com/rchen8

Hard Decisions Made Regarding OpenSea Staff

In a recent post on Twitter, OpenSea Co-founder and CEO Devin Finzer shared the note that affected workers received.

He started by thanking the people leaving for their critical role in OpenSea’s journey to the pinnacle of the industry.

He stated, that employees affected by the layoffs, had been contacted individually before the note was made public. He further declared that staff will receive a generous severance package.

The package includes continued health coverage into 2023 and accelerated equity vesting. The company will also make available its network to help with job placement.

Taking Action to Ensure the Future

The hard reality is that the crypto winter may well be a long-drawn-out affair with more pain still to come. The layoffs help prepare the company for the possibility of what looks like lean times ahead.

Finzer wrote that they made these difficult decisions “to put us in a position to maintain multiple years of runway under various crypto winter scenarios.” He further states, “we will only have to go through this process once.”

Confidence in the Future

All is not doom and gloom. The thinking at OpenSea NFT marketplace is that during this period of instability, we will see ” an explosion in innovation and utilities in NFTs.”

They will use this crypto winter “to build the foundations for new peer-to-peer economies” in what they believe will be the world’s largest market.

Afterthoughts

The layoffs at OpenSea will be followed by further job losses at other companies in the coming months. We wish those affected by these job losses a speedy return to the workforce.

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