Binance, the world’s largest cryptocurrency exchange, has reduced employee benefits as the company faces various difficulties. This is according to a recent report from the Wall Street Journal.
Despite CEO Changpeng Zhao’s claims of profitability and unaffected status in the face of a Securities and Exchange Commission lawsuit, the situation seems to be taking a toll on the firm.
Last week, Binance laid off over 1,000 employees globally, representing more than a third of its workforce. Additionally, three senior executives reportedly resigned due to concerns over Zhao’s handling of regulatory scrutiny, including an ongoing United States Department of Justice investigation.
According to former employees and internal company messages viewed by the Wall Street Journal, Binance implemented cost-cutting measures in June.
This involved discontinuing reimbursement for certain expenses like mobile phones, fitness, and working from home. The decision was justified by referencing the decline in profit caused by the current market environment and regulatory climate.
“Considering the current market environment and regulatory climate that have unfortunately led to a decline in profit, we have to be more prudent with our spending.” The company said.
Binance CEO Insists All is Well
The report suggests that Binance may consider further cost-cutting measures. Despite claims of profitability from CEO CZ, he informed employees during a company meeting that additional layoffs could occur every three to six months. The restoration of the previously cut employee benefits remains uncertain.
In response to business and regulatory concerns, a Binance spokesperson stated that the firm would evaluate “certain products, business units, staff benefits, and policies” to ensure efficient allocation of resources. This move aims to adapt to the evolving demands of users and regulators as the company prepares for the next major market cycle.
The recent developments at Binance, including ongoing legal disputes, the departure of top executives, staff layoffs, and reduced employee benefits, indicate a period of instability. As a leading industry player, the hope is that Binance resolves these issues swiftly and gets back on track.
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