Consensys, the Ethereum-focused software giant behind the MetaMask wallet, has announced layoffs affecting about 20% of its workforce, citing regulatory challenges and macroeconomic conditions. The New York-based company, led by Ethereum co-founder Joseph Lubin, stated on October 29 that it would eliminate 162 positions due to regulatory uncertainty and macroeconomic pressures, including rising interest rates and inflation.
The company also attributed the layoffs to what it called the “abuse of power” by the U.S. Securities and Exchange Commission (SEC). Consensys has been entangled in a legal battle with the SEC, which has accused the company of operating as an unregistered broker. In June, the SEC alleged that Consensys failed to register as a brokerage and improperly collected millions in fees. The agency claimed that the company brokered over 36 million crypto transactions since 2020, including at least 5 million that were securities.
Joseph Lubin expressed frustration with the current regulatory landscape, stating, “The lack of clear regulatory frameworks in some markets has made navigating our evolving space unnecessarily complex for innovators, builders, investors, and businesses. Multiple cases with the SEC, including ours, represent meaningful jobs and productive investment lost due to the SEC’s abuse of power. Such attacks from the U.S. government will end up costing many companies that have been investigated, sued, or sent Wells Notices millions of dollars.”
The regulatory pressure has had a significant impact on Consensys, leading to increased legal costs and operational challenges. The latest layoffs follow an already challenging year for the company, which reduced its workforce by 11% at the start of 2023.