Bitmain Powers Down Israeli Development Arm Due To Slumping Crypto Market Prices
Bitmain Shuts Down Israeli Development Arm Amid Bear Market
The bear market is making victims of even the most successful mining companies. Now, the crypto giant Bitcoin has decided to shut down its research and development arm based in Israel. Bitmaintech Israel, which acts as the company’s R&D center and is based in Ra’anana, is being shut down due to the pressure of the bear.
A total of 23 employees have been laid off after the announcement. This includes the vice president for sales and market, Gadi Glikberg, an important person in the company. The saddest part is that just a few months ago the company was reported to be interested in hiring more 40 employees to help with R&D.
Glikberg, which was fired just as his subordinates, affirmed that the global market suffered a major shake-up in the last few months and that Bitcoin had to analyze the situation of its companies all over the globe and decide which ones were more essential.
The company, called BitmainTech Israel, was originally launched in 2016 before the market boomed and then crashed. It was responsible for the launch of ConnectBTC, a Bitcoin mining pool that was launched in April 2017 as the market was starting to get hot. Some of the projects included mining, artificial intelligence and the blockchain technology.
One of the most important projects led by this company was Sophon, an artificial intelligence project which was very important for Bitmain, but that was halted for the time being now.
Bitcoin is currently still the world’s largest manufacturer of ASIC mining rigs. Despite the bear market, there is no hint that the exchange will lose its place as the negative effects affect all companies.
Bitmain And Legal Problems
Not only the bear market is currently a problem for Bitmain. The company also has two lawsuits going on right now. One of them is a class action lawsuit of $5 million USD because the company allegedly mined tokens illegally in the state of California.
The other one is filed against Bitmain, Bitcoin.com, Roger Ver and the crypto exchange Kraken for unfair methods that manipulated the prices of the Bitcoin Cash (BCH) network.
Other Companies Lay Off Staff During The Bear Market
While BitmainTech Israel was one of the heaviest casualties during the bear market, it was far from being the only company that lost something. Two other high profile companies were also responsible for laying off a lot of staff, however, both of them remained operational.
The first one was the blockchain startup Steemit, which fired 70% of its staff as its returns were simply not enough to cover the growing costs of running nodes. The other company that suffered (but considerably less than the other two) was ConsenSys, which cut 13% of its staff during an initiative called ConsenSys 2.0.
While presented as something good, Consensys 2.0 was basically a desperate move because the company was struggling with the bear market and had to concentrate on being more productive. Some people are reported to be hired in the (distant?) future, but at the moment, the company only axed employees.