The 2000 NFL championship game was dubbed the “Dot-Com Super Bowl” when some 20 of its enormously expensive advertisements were bought by technology companies, several of which were no longer in existence when the game aired, that did not survive the 2001 accident. .
To borrow a line from another sport, it’s déjà vu all over again, and the dot-com Super Bowl seems to be looking to crypto now.
Case in point: Among the $6.5 million 30-second advertisers during Super Bowl LVI was a 60-second ad for Coinbase, which collapsed under the weight of logged-in viewers. This morning (June 14), CEO Brian Armstrong announced that the company was cutting 1,100 jobs, roughly 18% of its workforce, as the Nasdaq-listed company’s share price collapsed along with the price of bitcoin and other cryptocurrencies.
See Also: Bitcoin’s Potential As ‘Digital Gold’ Loses Luster As Price Crashes
Then there is Crypto.com, which cut 5% of its workforce, 260 employees.
While stock and cryptocurrency exchange Robinhood didn’t announce itself in the 2022 Super Bowl, it did raise $5.5 million in 2021. It only cut 9% of its staff, and actually, the curse hit it last year too, since that the ad was published during the company’s marketing meltdown surrounding the halt of trading in shares of r/WallStreetBets – Gamestop, in which it was accused of favoring large clients at the expense of small ones to bail out a fund of coverage.
Read More: Next Congressional Hearing Scheduled for Robinhood-GameStop Debacle
This is not to say that all Super Bowl 2022 cryptocurrency exchange advertisers have succumbed to the curse with layoffs. FTX and eToro have not announced any job cuts. Neither did Binance, which didn’t technically advertise the Super Bowl, but ran a big campaign around the game.
Other US exchanges with jobs on the cutting floor include BlockFi, which announced it would lay off around 20% of its employees, around 400 in total, as well as Gemini, which cut 10%.
Latin American exchanges have also been hit hard. Latin America’s largest exchange Bitso cut 10% of its staff, Argentina’s Buenbit cut 45% and Brazil’s Mercado Bitcoin laid off 80 employees.
blood in the water
That said, everyone has been hit by the crypto bloodbath that began in November and redoubled in early April. It’s been a steady downward march since the second quarter began, with bitcoin at $46,000 and dipping briefly below $21,000 this morning (June 14), down 24% since Friday and down 55% in the second quarter.
Bitcoin has now given up all of its 2021 gains and there is a real chance, even a probability, that it could drop below $20,000, possibly even below the 2017 high of $19,783.21 set during the first cryptocurrency boom.
The No. 2 cryptocurrency, Ethereum, has dropped as much as 70% in the second quarter, briefly dipping below $1,100 on June 13 before recovering above $1,200 today. With very few exceptions, the 50 largest cryptocurrencies by market capitalization are down between 40% and 70% this quarter.
The problem, as Coinbase’s Armstrong explained on the Nasdaq-listed firm’s Q1 investor call on May 11, was that while cryptocurrency price volatility is good for cryptocurrency exchanges, it already that people buy and sell more when prices change rapidly, that only works when volatility is low. going in two directions.
Of course, he also said that while first-quarter 2022 results had tanked, down markets are “a great opportunity because… we tend to be able to acquire great talent during those periods. [while] others pivot, get distracted, get discouraged.”
See Also: Coinbase May Be Undeterred By 80% Drop, But Investors Are Clearly Affected
Derivatives exchanges are also affected
It’s not just about the spot exchanges that trade cryptocurrencies directly for retail and institutional investors. Crypto derivatives exchanges are also taking a hit along with their clients.
Crypto futures investors saw liquidations of more than $1 billion on June 13, as falling crypto prices led to forced closure of positions as traders were hit by margin calls.
More than half of those liquidations affected bitcoin traders, while another $317 million affected Ethereum investors. Blockchain Solana, a competitor to Ethereum, ranked third with $20 million in liquidated positions, according to CoinDesk.
Beyond that, there were signs that an increasing number of traders were closing their positions, which would suggest that they expect more volatility, likely to the downside.
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