California-based renowned investment and trading platform Robinhood was among the crypto firms forced to let off some of their employees this year due to the bear market and its associated negative implications. In April, the company laid off 9% of its full-time employees.
However, according to Vlad Tenev, Co-Founder and CEO of Robinhood, the previous layoff was insufficient. He recently announced that the company would lay off around 23% of its workforce due to the current adverse macroeconomic conditions, which include record inflation in the United States and the crypto market’s downturn.
CEO Vlad Tenev stated that nearly every fourth person would be let go, with employees mostly affected in the operations, marketing, and program management departments.
The recent market downturn made the situation tough for Robinhood
Despite the brief price increases, the months after the prior layoff announcement were relatively dismal for the digital asset market. This drop, combined with the United States soaring inflation, LUNA/UST disaster, and liquidity crisis, resulted in a major price meltdown and affected the financial aspect of Robinhood, leading to yet another redundancy process.
Tenev stated that each departing staff member will be able to continue working until October 1, 2022. They will receive regular pay and perks (including equity vesting). In addition, the company will provide cash severance, dental and vision insurance premiums, COBRA medical payment, and support in seeking new career options.
“We know that this news is tough for all Robinhoodies, and we are also offering wellness support to those who would like it,” Tenev continued.
These occurrences have resulted in a decrease in customer trading activity and assets under custody on the platform. The release coincides with Robinhood’s quarterly results, which revealed that the company’s revenue for the second quarter of 2022 was $318 million. Notably, these figures are much below the $565 million reached in the second quarter of last year.
Moreover, as TheCoinRise reported, the New York State Department of Financial Services or NYDFS recently imposed a fine of $30 million on Robinhood for allegedly violating cybersecurity, anti-money laundering, and consumer protection laws.