The NEAR Foundation, a prominent player in the Web3 industry, recently made the decision to downsize its team by approximately 40% as part of a realignment initiative. This significant reduction will impact 35 employees across various departments, particularly community, business development, and marketing teams. In contrast, the engineering team will remain intact. The NEAR Protocol, known for hosting three of the top ten Web3 apps and achieving record user numbers, aims to streamline its operations and focus on activities with a higher impact. This article delves into the foundation’s decision, the reasoning behind it, and the broader context of restructuring within the crypto industry.
After conducting a thorough review of its operations, the NEAR Foundation recognized that it had been ineffective and slow in certain instances, often trying to accomplish too many tasks simultaneously. As a result, the foundation determined that narrowing its focus is essential to achieving long-term success. By streamlining its activities, the NEAR Foundation can increase efficiency, speed, and focus on advancing key areas like chain abstraction, mainstream Open Web adoption, and user-owned AI. This strategic realignment will allow them to stay competitive and thrive in the fast-paced Web3 industry.
While the layoffs mark a significant change for the NEAR Foundation, it is important to note that they have not forgotten about the employees impacted by this decision. In their announcement, the foundation expressed their commitment to supporting the departing team members in finding new opportunities within the Web3 industry, the NEAR ecosystem, or elsewhere. This demonstrates a genuine concern for their employees’ well-being and preserves the foundation’s reputation as an organization that values its workforce.
Financial Strength and Stability
Contrary to the downsizing, the NEAR Foundation emphasized that its treasury remains strong and secure. Currently, they possess funds amounting to $285 million in fiat, 305 million NEAR tokens (worth over $1 billion), and $70 million in loans and investments. With such solid financial backing, the foundation can maintain its operations effectively and propel itself forward despite the reduced team size.
The NEAR Foundation’s decision to downsize its team is not an isolated incident within the crypto industry. Many other crypto-related companies and organizations have undergone similar restructuring efforts. For instance, Blackrock, one of the largest asset management firms in the world, is reportedly downsizing its team by 3% (approximately 600 employees). This move, like NEAR’s, is based on employee performance rather than capital issues and is a routine occurrence within the company.
In 2023, the crypto industry witnessed several waves of significant layoffs, affecting over 13,400 employees across 108 companies globally. OpenSea, a renowned NFT marketplace, downsized its staff by an astonishing 50% in November to accommodate significant changes related to OpenSea 2.0. Ava Labs, the team behind Avalanche, also reduced its workforce by 12% during the same month as part of a resource reallocation strategy to further drive their growth. Furthermore, Polkadot Technologies, a leading blockchain platform, downsized its workforce by 30%, specifically targeting the business development and marketing departments to concentrate on core technology development.
These instances, along with the layoffs at cryptocurrency exchanges like Coinbase and Binance, paint a broader picture of the industry’s current state. Despite significant market recoveries and positive trends, companies are choosing to restructure their operations to align with changing market dynamics and drive long-term success.
The NEAR Foundation’s decision to downsize its team by 40% as part of its realignment initiative reflects the organization’s commitment to streamlining operations and focusing on activities with a higher impact. By prioritizing efficiency, speed, and specific goals like chain abstraction and Open Web adoption, the NEAR Foundation aims to stay competitive in the rapidly evolving Web3 industry. While this move may be challenging for the affected employees, the foundation has pledged its support in finding new opportunities within the NEAR ecosystem and the broader Web3 industry. With a strong financial foundation and a thoughtful approach to restructuring, the NEAR Foundation is positioning itself for success in the future.
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