Beijing-based Bitmain Technology and Huobi plan to lay off a significant part of their staff in adjustment to a turbulent 2018 in the crypto market.
Bitmain and Huobi Adjusting To The Crypto Bear Market
Bitmain, the world’s biggest maker of cryptocurrency mining equipment, said in a statement that staff that is not critical to the business at the moment would be laid off.
“A part of that is having to really focus on things that are core to that mission and not things that are auxiliary. As we move into the new year we will continue to double down on hiring the best talent from a diverse range of backgrounds,” said Bitmain in the statement.
However, the crypto company has declined to specify exactly how many layoffs are planned. Huobi Group, through its spokeswoman, says that the company is trying to maximize the strength of its workforce by cutting its worst-performing employees.
The Beijing firm said it would still hire people for its core businesses and emerging markets. Prolonging bear market is hitting the miners really hard in cryptocurrencies. Over the past several months, some of the biggest crypto mining centers and facilities around the world have shut down amid lowering cryptocurrency prices and a decline in overall market activity.
This year bitcoin alone, the world’s biggest cryptocurrency, has lost more than 70 percent of its value. In total, over US$500 billion wipes off the value of more than 2,000 cryptocurrencies available in the market.
Bear Market Have Eroded Miners’ Profit
Researchers estimate that miners have been mining Bitcoin and other major crypto assets at a loss since mid-2018. The Bitcoin price needs to actually breakeven places at $4,500. However, the value of the asset drops below that price. Moreover, it has been between the range of $3, 200 and $4, 000 over the past two months.
Bitmain has historically been exclusively focusing on cryptocurrency mining. The core business builds around Bitcoin mining, however, expands to Ethereum, Litecoin, Monero, and others. Lately, though, the company’s executives are looking to transition into the artificial intelligence and machine learning fields.
Bitmain has also announced it’s shutting down its development center in Israel. They are also firing local employees, citing the “shake-up” of the crypto market in recent months. Also within the past week, Blockchain startup Steemit has reportedly laid off close to 70 percent of its staff.
Another African blockchain startup that was trying to raise capital through a public round on the Ethereum blockchain couldn’t reach even a quarter of its hard cap. KuBitX had set their target hard cap at $7.57m.
However, due to the extremely low market sentiments, as at 19th of December, they could only raise about $711,008.147 from contributors. The company also announced it will go through some internal restructuring of the team members. Some believe it means it plans to lay off some of its staff too.
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