Crypto And Tech Winter Sees 10% Layoffs At Gemini And Tesla

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Tech and crypto become more and more correlated apparently. Both now speak of ‘winter’ conditions, aka a tough time that they’re going through.

The latest sign of this correlation is that both Tesla and crypto trading platform Gemini announced 10% layoffs in the past few days.

Just last week, an email from CEO Elon Musk informed management that:

Tesla will be reducing salaried headcount by 10% as we have become overstaffed in many areas.

Coinbase, Gemini, Tesla, and thousands of small business has cut staff/employee’s by 10%…

— Tia Becca (@Tia_becca_) June 7, 2022

As Musk is mostly seen as a visionary, US media has raised the alarm and forecasts other companies will be forced to do the same. Tesla’s announcement comes only days after Elon had ordered everyone back in office five days per week.

Already in the month of May, Netflix announced its second round of layoffs, after the company had an abysmal stock market run in 2022.

Divest 10%

A similar situation seems to be taking place in the world of crypto, which has seen many platforms announce layoffs (Coinbase announced a hiring freeze, which was extended last week). Latest example was Gemini.

The Winklevoss brothers, who became world famous because of their portrayals in the 2010 movie The Social Network about the origins of Facebook, announced in a statement last week that their trading company, Gemini Trust had decided to “divest about 10%” of its staff.

They cite the “strong contractions” of the crypto markets that follow the “dramatic moments of hypergrowth” to justify this decision. The Winklevoss brothers believe that this situation is aggravated “by the current macroeconomic and geopolitical turbulence”.

Gemini, Tesla, and many other tech companies are laying off 10% of their workforce. This highlights the importance of entrepreneurial thinking. When a company is trying to weather tough market conditions, lay offs are usually the first cost cutting measure.

— Godwin David (@iamgodwindavid) June 3, 2022

The founders of Gemini asked their team leaders “to focus only on mission-critical products” and “if their teams are the right size for current market conditions”. These would be “likely to persist for some time”.