DeFi Dodges Worst of Crypto Layoffs: Report

It may not be a surprise that so many workers lost their jobs in crypto in 2022, but DeFi largely dodged the fallout.

According to data from CoinGecko, 6,820 web3 workers were made redundant from February 2022 until the end of the year. CoinGecko told The Defiant that decentralized protocols let go of 157 employees, or 2.3%, of the total layoffs in the cryptocurrency industry.

Downsizing

Web3 companies continue to downsize this year.

CoinGecko’s data shows that crypto firms let go of 2,806 staff in January, the equivalent of 41% of the crypto firings in all of 2022.

Centralized exchanges accounted for 85% of January’s layoffs, with CoinGecko attributing the downsizing to low trading volumes compared to the 2021 bull market. The Defiant reported Jan. 6 that Huobi is planning to let go of 20% of its staff.

Tech Sector

The failure of centralized exchange FTX in November also drove a spike in web3 redundancies with 1,805 web3 employees laid off that month — 82% of which worked for CEXes.

The report’s authors expect 2023’s layoffs will exceed last year’s figure.

However, CoinGecko noted the increase in crypto layoffs was in line with the broader technology sector.

The tech industry lost 19,856 jobs in 2022 and 12,679 employees in January. Crypto ranked 10th among technology sectors for layoffs in 2022.