The boss of US trading app Robinhood has fired almost a quarter of its workforce as retail investors quit the platform amid falling crypto prices.
The value of assets held by the California-based business plummeted 31% in the three months to June, as almost two million users left the app. The firm posted a net loss of $295 million (£242 million), while transaction fees for stock trading sunk 19% to $29 million.
Robinhood boss Vlad Tenev wrote in a blog post: “We have seen additional deterioration of the macro environment, with inflation at 40-year highs accompanied by a broad crypto market crash. This has further reduced customer trading activity and assets under custody.
“In this new environment, we are operating with more staffing than appropriate. As CEO, I approved and took responsibility for our ambitious staffing trajectory – this is on me.”
The announcement marks the latest round of job cuts in the crypto sector as tech firms that went on a hiring spree during the crypto boom in 2021 pare back their expansion plans as investor enthusiasm for digital assets dries up. In June, Crypto trading platform Coinbase laid off over 1,000 employees as billionaire CEO Brian Armstrong braced for a “crypto winter,” while in July, American bitcoin mining business Compass fired 15% of its workforce and slashed executive pay after a series of “multiple setbacks and disappointments.”
Robinhood announced an initial round of job cuts in April after identifying “duplicate roles and job functions.” A recently as December, the company said it expected its 3,800-strong headcount to “continue to grow for the foreseeable future.”
It comes as cyber criminals stole $200 million worth of digital assets from two crypto firms in the space of 24 hours, leaving customers stunned as they found their crypto wallets empty. One of the firms, Solana, said it was investigating the incident and urged customers to abandon compromised wallets.
Robinhood shares fell 2.3% in pre-market trading. The stock has fallen 50% since the start of the year.