As Crypto Companies Increase Layoffs Due to Bear Market, Be Watchful for Whistleblowers
Even with a few wins for altcoins in the crypto industry, the market has largely seen mostly declines over the course of the last few months. Unfortunately, without the revenue that each of these platforms need, it becomes harder to maintain the size of the original staff. A recent tween from a government enforcement defense lawyer, Jake Chervinsky, suggests that the layoffs are far from over.
The tweet says,
“As the bear market deepens, more crypto companies will have to lay off employees to keep the lights on. This creates a new risk: disgruntled former employees often become whistleblowers, especially if they have valuable intel that entitles them to an SEC or CFTC bounty reward.”
Huobi and Bitmain Technologies, two of the largest companies in the market, were reportedly letting go various members of their staff, but the reasons were not all the same. In an official annoucement on December 17th from Bitmain, the company stated,
“It’s affirmative. The layoff will start next week and involves more than 50 percent of the entire Bitmain’s headcount.”
Huobi also confirmed their layoffs, though their annoucement became a major subject of discussion on social media. Twitter user Dovey Wan explained over the course of multiple tweets what Huobi has been doing, noting the expansion that they setup in 2017, which ultimately proved to be too much.
Bitcoin quickly reached to the bottom of their price per coin, and the biggest firms are looking to secure their revenue with a smaller staff. While it brings in a major threat to some companies, there are some employees that will have a new opportunity, “if they have valuable intel that entitles them to an SEC or CFTC bounty reward,” according to Chervinsky.
Towards the beginning of the year, the US Commodity Futures Trading Commission (CFTC) tried to bring these whistleblowers out of the woodwork with a bounty, urging them to reveal “pump and dump” schemes. The annoucement also said, “If you have original information that leads to a successful enforcement action that leads to monetary sanctions of $1 million or more, you could be eligible for a monetary award of between 10 percent and 30 percent.”
Will the bear market continue? Will other crypto companies decide to let their workers go to save themselves? As 2018 draws to a close, there is a whole new year to explore in the industry.