As NFTs continue to take a hit in sales, OpenSea, the NFT’s most prominent marketplace, decided to cut its workforce.
While plans have circulated for months, it was announced on Thursday that OpenSea laid off 20% of its employees. The news arrived on Twitter as David Finzer, the marketplace’s co-founder and CEO, shared it after announcing it on Discord.
“We made the incredibly sad and difficult decision to reduce the size of our team,” he wrote. “Today we are going to say goodbye to many of our friends and team members across OpenSea.
The buildup to the cut
Before the layoff, OpenSea operated with around 275 employees. The decision left them with a workforce of 230 as 40 employees bid their goodbyes.
In January, OpenSea announced that it was valued at $13 billion after a round of Series C funding that totaled $300 million.
Back then, the company was operating with only 90 people. Once the fund came in, Finzer shared plans to use the money to grow the team, doubling the customer service employees to improve the quality of responses to customer support requests.
The company is no stranger to trouble as difficulties and plagiarism complaints became a recurring problem on top of hacks and scams that led to legal trouble.
Some problems stemmed from within as a former OpenSea employee was arrested in early June for being connected with an insider trading scheme in the marketplace.
OpenSea also decided to limit the number of NFTs it could create in a day, causing uproar on the site and prompting executives to reverse their decision.
OpenSea users from Iran were also kicked off the platform after the company complied with US sanctions against Iran.
Read also: OpenSea Now Supports Solana
Upon posting his announcement, Finzer expressed his appreciation for the employees who were being let go and said he would “treat them with great care” by providing them a generous severance and healthcare coverage up to 2023.
David Finzer wrote that despite building OpenSea to endure an inevitable slump in crypto value, “the combination of a crypto winter and broader microeconomic instability” prompted him to formulate a new strategy.
“The changes we’re making today put us in a position to maintain multiple years of runway under various crypto winter scenarios (5 years at current volume) and give us high confidence that we’ll only have to go through this process once,” he wrote.
“We have a huge opportunity in front of us,” Finzer added. “With the hard (but important) changes we made today, we’re in an even better position to capture what will soon become the largest market on the planet.”
OpenSea was not the only company to let its workforce go, as others have been doing the same for the entirety of 2022.
While it is regarded as a crypto exchange, CoinBase launched an NFT marketplace earlier this year. However, they laid off over 1,100 people in June.
Gamestop also announced a round of layoffs before launching an NFT store last week.
Meanwhile, crypto hedge fund Three Arrows Capital has been in a tight spot after its founders disappeared, forcing the company to liquidate.