The startup blockchain Steemit has fired almost 70% of staff, citing the prolonged bear market for cryptocurrency.
In a video posted to YouTube on Thursday, Steemit's CEO and founder, Ned Scott, said:
"While we've been building our team over the last few months, we've based ourselves on fundamentally projected higher fund projections for the market and since there's more, we've been forced to lay off more than 70% of our organization and start a restructuring. "
The address did not specify how many Steemit employees had before the dismissal and requests for further details had not been returned within the time of printing.
However, elaborating the impact of the low market prices for the major cryptocurrencies like bitcoin, Scott wrote in a blog post that "fiat returns" could no longer adequately cover the "rising costs of running the complete Steem nodes. ".
Steemit is a social media platform that uses blockchain technology to reward publishers and editors of content with tokens called STEEM.
Launched in March 2016, Steemit was ahead of one of the six major cryptocurrencies operating in the blockchain space with an approximate market capitalization of $ 157 million. Today it ranks 48th among the cryptographic currencies, with a market capitalization of around $ 106 million, according to CoinMarketCap.
Scott described "the financial course for [the company] is very altered ", but stressed that the startup intends to continue to struggle through the downward trends of the market.
"There's nothing I want more now than to survive, keep steemit.com operational and keep the mission alive, to create great communities," Scott said.
He added that the company's priority will be short-term "cost reduction solutions", including a series of technical changes that reduce the storage and energy costs of platform management.
Steemit image via Shutterstock