building for the long-term with a reduced staff
|Dec 4||Public post|| 1|
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The crypto carnage has officially hit the job markets. In just the past week, multiple crypto companies have announced restructurings, with more seemingly imminent.
ConsenSys, the Ethereum venture studio, which had swollen up to 1100 employees (as reported by Breaker):
Until now [Lubin said], “it has been enough to show up, it has been enough to do something cool, it has been enough to make a splash.”
No longer. From now on, projects will be judged on three metrics: revenue, or return on investment, which could mean projected future value rather than cash value today; benefit to the Ethereum ecosystem (as with protocol development); and social good, for which the means of assessment are still being determined.
“We’re going to get a lot more rigorous in terms of milestones and timetables,” Lubin tells BREAKER, even if that means “dissolving projects if we’ve come to the conclusion that our earlier assumptions were incorrect.” (When ConsenSys closes a project, it will try to move affected staff into other initiatives. But Lubin is not ruling out layoffs.)
SteemIt, the decentralized media play, which has fallen 96% from its peak:
“While we were building out our team over the last many months we have been relying on projections of basically a higher bottom for the market and since that’s no longer there, we’ve been forced to lay off more than 70 percent of our organization and begin a restructuring,” said founder, Ned Scott.
“There’s nothing that I want more now than to survive, to keep steemit.com operating, and keep the mission alive, to make great communities.”
ETCDEV, a development team working on Ethereum Classic just wound down. Spankchain let a few people go. And I talked to no shortage of folks at Consensus Invest last week who were cutting staff to prepare for a long, cold winter.
It’s amazing how quickly sentiment has crashed back down to reality. But, unfortunately, in a sentiment driven market, the beatings will only continue until morale improves.
P.S. Helluva week to be rolling out the paid research subscription plan, eh?]
P.P.S. This is great news for the cash rich, and engineering poor. A LOT of new talent is about to hit the market from projects that are bleeding cash and crypto. On the other hand, if you’re engineering rich and cash poor, get ready for some tough choices.
P.P.P.S. Share. Subscribe. Spread the (rational) crypto love. Tweet at me or Messari for requests, feedback, comments, or questions.
Best of the Rest - What We Missed Last Week
Every weekend, we dig through the past week’s posts from crypto’s other great sources of content to see what we missed in our own weekend reads.
Here’s us curating the curators:
An Honest Explanation of Price, Hashrate & Bitcoin Mining Network Dynamics - Christopher Bendiksen, CoinShares
In this two part Medium post Christopher Bendiksen, head of research at CoinShares, covers some key takeaways from the firms most recent Bitcoin Mining Report. Overall, it is clear that many miners are feeling the squeeze caused by slumping prices and likely taking their hardware offline. According to CoinShares research, the estimated average all-in cost (including depreciation) to mine one bitcoin is $6,800, up from $6,500 when the last report was written in June. Of course some miners see lower costs, and some see higher, but with prices hovering around $4,000 it is clear that less efficient miners are likely throwing in the towel.
Crypto Winter Is Here and We Only Have Ourselves to Blame - Michael J Casey
(h/t Token Daily)
During the past year, the crypto community spent its time focused not on immutable digital money but getting rich in fiat terms and riding the mania that surrounded the space. Now crypto winter is here, and as prices fall, it’s time to get serious about what matters or risk irreparably damaging the industry’s image with the public. We’ve been here before, and the bear market between 2014 and 2016 was a period of constructive building. The excesses of 2017 are gone and now is the time to refocus on adoption.
During the token craze last year many attempted to use existing valuation frameworks for companies to value cryptoassets. Chris Burniske argues that instead, investors should focus on the distinct differences between crypto networks and crypto companies. Crypto networks are comparable to emerging economies that offer a single (digital) service. These networks have global reach and the ability to organize and incentivize human activity in a decentralized manner. Companies will be created to bundle services from crypto networks and serve users, with thousands or tens of thousands of companies supporting every successful network. Investors, therefore, have the choice between purchasing a piece of a network (cryptoassets) or a piece of a company (equity). According to Burniske, the potential returns for cryptoasset investors will be higher, but there will be only a few successful networks.
Did I miss something?
Send me the link, your twitter handle and your best imitation compression algorithm write up. If I like it, I’ll include your bit next issue (with attribution).
🎧 ICYMI on the Messari podcast, This week, Katherine sat down with Messari’s own Dan McArdle to talk about the recent downturn in crypto markets. Dan shared his thoughts on what is now the fourth "crypto recession" for him, and where he thinks things might head in the short to medium term.
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