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The largest crypto exchange in the Middle East is affected by the ongoing market volatility, affecting the operations of crypto companies.
Rain decided to notify its employees about the layoff in an internal communication last Thursday, as the communication was private. Before the layoffs were announced, the firm had around 400 employees within the organization.
How does this impact the crypto markets? Let’s find out more.
Rain Inc. Announces Layoffs
Going through a bearish and one of the most volatile phases, the cryptocurrency market is suffering through a lot of concerns, and the real-world impact seems clear.
The new developments come as a table-turner when compared with the scenario in 2021 when most of the cryptocurrencies experienced all-time highs.
When it comes to Rain Inc, the company has been in the news earlier as well regarding layoffs for its employees. Commenting on the matter, Rain’s co-founder Joseph Dallago mentioned the market conditions affecting the current standing of the exchange.
Joseph mentioned in a LinkedIn post how the last year’s bullish phase was a result of people discovering the unique capabilities of cryptocurrencies.
“Crypto saw a meteoric rise at the start of 2021,” Joseph mentioned in his post.
He further continued, “This was fuelled in part by sustainable interest and enthusiasm for the unique capabilities of this technology, and in part by unsustainable rampant speculation.”
“The volatility in the industry has been difficult to properly plan for, which has resulted in the unfortunate changes that we have had to make today.”, Joseph mentioned about the recent layoffs at Rain.
“This year has been a time for self-reflection, and it is an opportunity for the industry to focus on its fundamentals and build crypto into a legitimate financial system. We had to say goodbye to a lot of really talented team members.”, said Joseph.
The layoffs were done by the company to reflect on “operational needs and market conditions,” as per what the company told Bloomberg.
About Rain Inc.
Rain is the largest cryptocurrency exchange in the Middle East and allows its users to buy sell, swap and store Bitcoin, Ethereum and 70+ other cryptocurrencies.
The company’s latest funding round was led by San Francisco-based cryptocurrency-focused investment company Paradigm and Kleiner Perkins. It has also received backing from Coinbase, Global Founders Capital, Middle East Ventures Partners, Cadenza Ventures, Jimco and CMT Digital.
The company previously had plans to expand its operations and grow its team across the region and hoped to double in size.
In fact, before the slump, Rain was on a hiring spree by bringing on board a large list of lawyers, bankers and consultants to join its Dubai-based team, as it hoped to take a slice of the ongoing crypto craze in the middle east.
Crypto Exchanges Laying Off Employees & Other Measures
With the crypto winter failing to calm down, exchanges around the world are seeing the results in some or the other way. The cryptocurrency market has dropped from its once-high of $3 trillion valuation to less than a trillion now.
Crypto.com recently laid off 260 employees in June, or in other words, around 5% of its total workforce. However, a few sources mention that the company laid off a few more employees apart from that, the company laid off hundreds more quietly. Many blame the lack of transparency within the organization to figure out the exact number of layoffs within the company.
Another crypto lender, BlockFi laid off 20% of its staff in June, with Coinbase laid off almost 18% of its workforce in the same month.
Apart from laying off the existing workforce, many exchanges are facing the heat of the crypto winter by adopting different measures. Some exchanges have in fact laid out plans to halt withdrawals due to a lack of liquidity on their platforms, with crypto exchange Celsius leading the pack to do so.
The Celsius exchange has since then filed for bankruptcy.
What The Future Holds?
While many investors see it as the crypto ‘bubble’ finally bursting, a few are optimistic too.
As companies slow down, so have the investments. However, the interesting thing to note here is the fact that institutional investors haven’t completely divorced themselves from the idea of investing in a crypto exchange or related products completely.
Apart from this, there are even speculations by a few experts that Bitcoin might hit the $100,000 mark.
However, while that happens, the current layoffs have certainly made institutional bodies and authorities take a more stringent look at these companies and their operations for a better understanding.
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