Crypto Exchanges Boost Hiring in Wake of Coronavirus Crash
(Bloomberg) -- As speculation abounds around whether Bitcoin is poised for another bull run, a slew of crypto exchanges are embarking on hiring sprees while job losses are soaring.
Kraken LLC said on Monday that it had been planning to hire 250 staffers this year, but will instead recruit 350. Binance Holdings Ltd., which has more than 1,000 employees, expanded its workforce by 25% in the first quarter and is beefing up its team supporting Binance Pool, a new mining operation launched in April. Exchange OkEx, also with a workforce of more than 1,000, said it will announce a global hiring initiative in May. Coinbase Inc. lists dozens of openings.
Many cryptocurrency exchanges and adjacent businesses -- those that lend money to the exchanges or secure users’ deposits -- are revving up recruitment in anticipation of greater interest from investors thanks to the so-called Bitcoin halving in May, when rewards issued to computers supporting the network will be slashed in half. Past halvings have resulted in Bitcoin bull runs.
Others are betting that more investors will look to alternative assets like cryptocurrencies due to instability in traditional financial markets, the result of the coronavirus epidemic.
“The halving excitement may well be part of it -- more generally, I’d say there’s a greater awareness of crypto as an asset class among the general public,” said Nic Carter, co-founder of Boston-based Coin Metrics, a crypto markets researcher that just added five full-time employees.
Millions more Americans filed for unemployment benefits last week, sending the six-week total above 30 million since the coronavirus pandemic began to shutter businesses across the U.S. Initial jobless claims totaled 3.84 million in the week ended April 25, according to Labor Department figures Thursday.
The crypto exchanges and related companies are an anomaly even in their industry. In recent months, many crypto businesses like ConsenSys cut workers. The number of jobs available in crypto is down: Only 84 new positions were posted to Crypto-careers.com in April of this year, down from 300 last year, according to the site.
But the exchanges, which make the bulk of their money off trading fees and thrive at times of volatility, have had a good 2020. Bitcoin crashed 46% from March 6 to March 16, and trading volumes exploded as much as 20 times. If prices continued to drop, the volumes may have shrunk; but instead, Bitcoin’s price has been recovering.
Now many exchanges anticipate a flood of investors streaming fearing they’ll miss out on the halving in May. The coin’s price rose from around $12 to over $1,000 in the year following the 2012 cut in rewards, and advanced about 1,000% in the wake of the 2016 halving, though that happened at a time when the token was gaining greater mainstream recognition.
“It is really nuts to me that there’s such speculation, since everyone already knows it is going to happen, and should be pricing it in as past information,” said Lex Sokolin, global financial technology co-head at ConsenSys. “But what we can learn is that the crypto markets are still irrational and short-term oriented, and that companies are betting on the speculation of others to drive their own staffing decisions.”
©2020 Bloomberg L.P.