Immutable, a renowned Australian crypto gaming firm known for the NFT trading card game Gods Unchained, has revealed that it will lay off 11% of its total employees, despite previously announcing significant layoffs in mid-2022. This followed Polygon Labs laying off 20% of its workers as part of the consolidation process.
Immutable laid off 20 employees in June or about 6% of its personnel, but this wasn’t enough to fend off financial difficulties and a necessity to sustain cash flow during the fall of the cryptocurrency market.
According to a recent report from The Sydney Morning Herald and The Age, which claims to have seen a note from the chief executive and co-founder James Ferguson to employees, the company is now implementing further cuts, with sweeping layoffs announced on Wednesday morning.
The layoff was communicated internally, and the company claimed the necessity to save cash reserves and prioritize key initiatives as the reason.
The CEO, James Ferguson, acknowledged the effects of the shift on the workforce but defended it as essential for the company’s long-term survival.
“This is difficult news, and I am sorry to all Immutables impacted by these changes,” James Ferguson wrote to the staff. “As CEO, I am deeply aware that these role eliminations will directly impact the lives of many, and I take full ownership for these actions.”
Immutable is Cutting Staff Despite Recent Funding
The corporation is reportedly restructuring its organizational structure besides these scheduled layoffs in an effort to make up for lost revenue. This includes the intended outsourcing of video game creation to alternate partners so that the crypto gaming platform can concentrate on developing competence in Web3 and cryptocurrency technologies.
However, Immutable is downsizing despite receiving $200 million in March 2022 from investors led by Temasek, which valued the company at $2.5 billion. This served to support the company’s overall growth objectives. At this point, it’s unknown how this money was spent.
Immutable’s layoffs follow the most recent layoffs at Ethereum Layer-2 scaling startup Polygon. The network has cut off approximately 20% of its personnel, or 100 individuals, as part of a reorganization exercise amid the continuing crypto winter.
With a balance of more than $250 million and over 1.9 billion MATIC tokens, Polygon said that it has completed its strategy for the next five years of promoting widespread adoption of Web3 by scaling Ethereum.
These job cuts in the web3 sector are not surprising, given that the cryptocurrency sector has lost over a trillion dollars in value since 2022, as rising interest rates exacerbate fears of an economic downturn. Many crypto firms also bit the dust in 2022, leading to several ongoing high-profile lawsuits.