Crypto exchange Binance plans 15-30% hiring spree in 2023 even as rivals slash jobs
Zhao Changpeng, founder and chief executive officer of Binance, attends a conference at Porte de Versailles exhibition center in Paris, France June 16, 2022.
Benoit Tessier | Reuters
Binance is planning a hiring spree in 2023, CEO Changpeng Zhao said Wednesday, taking a somewhat contrarian view as crypto firms lay off huge swathes of staff amid continued pressure on coin prices.
Zhao said Binance, the world’s largest cryptocurrency exchange, said the company increased headcount in 2022 from 3,000 people to “almost” 8,000.
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In 2023, Binance plans to increase the number of staff by between 15% and 30%, Zhao said at the Crypto Finance Conference in St. Moritz, Switzerland.
Rival exchanges have been forced to cut large parts of their workforce after nearly $1.4 trillion was wiped off the crypto market in 2022 and major digital currencies including bitcoin and ether saw their prices plunge.
In November, Kraken announced it was laying off 30% of staff, and this year Huobi and Coinbase said it would cut 20% of its workforce. That was the second round of job cuts for Coinbase in the last year.
Zhao said Binance needs to get the company “well-organized” ahead of the next crypto bull run and admitted the exchange is “not super efficient.”
“We will continue to build and hopefully we will ramp up again before the next bull market,” Zhao said.
The industry was plagued last year by collapses of major projects, liquidity issues, bankruptcies and the high-profile failure of crypto exchange FTX. Sam Bankman-Fried who founded FTX has been charged with eight criminal counts by U.S. prosecutors, including fraud.
Binance had a big role to play in FTX’s collapse. In November, Binance offered to buy FTX’s non-U.S. businesses which were facing liquidity issues but then later backed out of the deal. Zhao said publicly that his company was selling its holdings in FTX’s native token FTT, which exacerbated the collapse of that digital coin, adding to FTX’s downward spiral.
Zhao has said that he “did not master plan” the collapse of FTX.
In response to a CNBC question on the sidelines of the CFC St Moritz conference, the Binance CEO said the “actual damage is not that high” on the crypto industry from the FTX collapse. He said FTX “is not a big player, they just make a lot of noise.”
“There’s definitely damage [but] the industry will be fine,” Zhao said.
State Street is reiterating its bullish stance on the artificial intelligence trade despite the Nasdaq’s worst week since April.
Chief Business Officer Anna Paglia said momentum stocks still have legs because investors are reluctant to step away from the growth story that’s driven gains all year.
“How would you not want to participate in the growth of AI technology? Everybody has been waiting for the cycle to change from growth to value. I don’t think it’s happening just yet because of the momentum,” Paglia told CNBC’s “ETF Edge” earlier this week. “I don’t think the rebalancing trade is going to happen until we see a signal from the market indicating a slowdown in these big trends.”
Paglia, who has spent 25 years in the exchange-traded funds industry, sees a higher likelihood that the space will cool off early next year.
“There will be much more focus about the diversification,” she said.
Her firm manages several ETFs with exposure to the technology sector, including the SPDR NYSE Technology ETF, which has gained 38% so far this year as of Friday’s close.
The fund, however, pulled back more than 4% over the past week as investors took profits in AI-linked names. The fund’s second top holding as of Friday’s close is Palantir Technologies, according to State Street’s website. Its stock tumbled more than 11% this week after the company’s earnings report on Monday.
Despite the decline, Paglia reaffirmed her bullish tech view in a statement to CNBC later in the week.
Meanwhile, Todd Rosenbluth suggests a rotation is already starting to grip the market. He points to a renewed appetite for health-care stocks.
“The Health Care Select Sector SPDR Fund… which has been out of favor for much of the year, started a return to favor in October,” the firm’s head of research said in the same interview. “Health care tends to be a more defensive sector, so we’re watching to see if people continue to gravitate towards that as a way of diversifying away from some of those sectors like technology.”
The Health Care Select Sector SPDR Fund, which has been underperforming technology sector this year, is up 5% since Oct. 1. It was also the second-best performing S&P 500 group this week.
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