ShapeShift Exchange Cuts 37 Team Members in an Attempt to “Overcome Crypto Winter”
Winter is here and we have to do what it takes to survive. No, this is not a line from the hit TV show Game of Thrones, but the reality the crypt industry is facing currently. Popular crypto exchange ShapeShift seems to be the latest victim.
They have laid off 37 of their team members which are about a third of their workforce. Their CEO Erik Voorhees wrote a blog post titled “Overcoming ShapeShift’s Crypto Winter and the Path Ahead” in which he tries to explain why he was forced to take these harsh decisions.
With a heavy heart, today we laid off 37 people. We've published a blog on this, also discussing some of our missteps and lessons as a company. "Overcoming ShapeShift’s Crypto Winter and the Path Ahead" by @ShapeShift_io https://t.co/1eNT54eyPp #bitcoin
— Erik Voorhees (@ErikVoorhees) January 8, 2019
He sets the tone of the blog by saying: “Crypto, like the moon we strive toward, is a harsh mistress. We ride high and fast during the ascents, growing at rates unseen almost anywhere else in the business world. And when the markets turn, the crypto recession is similarly dramatic and severe.”
He goes on to say that there were various reasons for the company’s downfall in 2018 like regulatory issues, structural issues, customer adoption problems, financial issues because of the bear market and a few more factors.
It was surprising to see that a company’s CEO can be so honest about the problems in his firm considering the fact that traditionally when the CEO of the company is so honest, the company ends up losing value. We don’t have to look further than Tim Cook and Elon Musk.
He ends up being optimistic in his post later on saying: “Among its many virtues, crypto assets enable people (and machines) to store value easily themselves and to transfer value directly to someone else, anywhere on Earth. This power is awesome and unprecedented.”
Although many users attribute the loses of the company to the company’s KYC process.
You may as well just shut it down now that you require KYC. Cut your losses.
I imagine your volume dropped off a cliff when you did that?
— Matt Odell (@matt_odell) January 8, 2019
ShapeShift had announced that it will be introducing a system of membership, which serves as an advanced loyalty system for its ongoing users. It's understood that this system will lead to both a system of better pricing overall and far superior user experience. This drew a lot of criticisms from all over the crypto ecosystem.
Even Andreas Antonopoulos, regarded by many as one of the industry's leading thinkers and writers, commented:
“Very disappointed that ShapeShift_io is implementing KYC. Just goes to show that any centralized entity will be pushed in that direction, which is why LN, atomic swaps, and Decentralized Exchanges are the only way to resist surveillance economics.”